Oppenheimer & Co Senior Analyst: 'Costco One Of The Best Run Retailers In World, But Hesitant To Recommend The Stock To Clients'

Costco Wholesale Corporation COST is all set to report its quarterly earnings post the closing bell on Wednesday. Brian Nagel, senior analyst at Oppenheimer & Co, was on CNBC recently to discuss how much impact will oil prices have on Costco’s results and whether the stock is currently overvalued.

Not Terribly Concerned

“I think it’s going to be very interesting to watch the impact of gas prices upon the Costco results tonight,” Nagel  said. “But look, I think, largely the markets going to look past any type of gas price disruption.”

“I mean, what we  learn again and again is that Costco is really one of the best run retailers in the world and the people who own this stock own it for the long-term retail prowess of the company. So, I am not too terribly concerned about what impact gas prices may have on the stock price.”

Hesitant To Recommend

Nagel  was asked if he thinks that Costco’s stock is undervalued at this point. He replied, “No, that’s my only concern with Costco. It’s I don’t think the stock is undervalued here and I have been hesitant to really recommend it to our clients for sometime just given the multiples at which it trades. So, I’d like to see, get a better opportunity to buy the stock. The stock hasn’t given us that opportunity in sometime.”

Buyer On Dip?

On whether he will be a buyer if shares of Costco dip following its earnings, Nagel said, “It depends. I mean, I’ll have to see how much it moves down. I have multiple targets in my head as to where I think Costco could get really attractive, we are still [ways] away from that.”