Jefferies Reiterates Hold Rating and $74 PT on Costco

Jefferies & Company has published a research report reiterating its Hold rating and $74 price target on Costco (NASDAQ: COST).In the report, Jefferies writes, “Investors are perpetually lured to the upside earnings potential of Costco based on a thesis with three key components; a little more gross margin, higher member fees and leveraging expenses at slightly lower comp store sales levels. The truth is that we don't see these typically come together all at once and the latest release demonstrates that. With the hike in fees, management seems to be easing off of the margin expansion story.”COST closed yesterday at $80.25.