Consumer staples have grown into one of the most desirable sectors for investors amid the COVID-19 outbreak. We have entered the second month of lockdowns all over North America and much of the developed world. Jobless claims have exploded over the past two weeks in the United States. Moreover, these next two weeks are projected to see the COVID-19 crisis intensify to peak levels.
Many investors will undoubtedly be on the hunt for stability in these uncertain times. Today I want to look at one of the most dependable defensive stocks to target right now.
Costco (NASDAQ:COST) operates membership warehouses in the United States and around the world. The stock has only declined 1.5% in 2020 as of close on April 3. This slight drop put it in very friendly territory after investors witnessed the fastest decline into a bear market since the 1987 crash.
The company released its second quarter fiscal 2020 results on March 5. In the year-to-date period, U.S. sales were up 6.6% year-over-year, which marginally outpaced total company performance. E-commerce sales surged 28% from the prior year in Q2, reflecting the apprehension to store shopping for the time being.
Costco last announced a quarterly dividend of $0.65 per share. This represents a modest 0.9% yield. The company boasts an immaculate balance sheet. It last possessed a price-to-earnings ratio of 33, which is still better value in comparison to an average of its industry peers.
Costco stock remains an attractive hold in the early spring.
