Costco Shares Drastically Decline over Three-Month Period

The recipient of a bachelor's in economics from College of the Holy Cross, Chuck Grom is an experienced stock analyst who has appeared numerous times on CNBC and been quoted by hundreds of news outlets. Since February 2017, Chuck Grom has served as managing director of Gordon Haskett Research Advisors, where he covers a variety of broadline and department store stocks, including Costco.

Despite scoring an A in VGM (Value, Growth, Momentum) from Zacks Equity Research, Costco's stock has been plummeting steadily for three months. The wholesale giant is still one of the most dominant in the industry based on its range of products and quality of merchandise, but Costco Wholesale Corporation shares dropped over 14 percent from June to the end of August. In contrast, the retail discount store industry declined just 5.9 percent on average. 

Shares began to be affected when it was announced that Amazon had purchased Whole Foods Market for $42 per share in a deal that totaled a reported $13.7 billion. Shares of Costco plunged nearly 7.2 percent that day and took another drastic dip in August. However, Zacks is not concerned with the stock's long-term potential, as Costco has continued to expand its presence with at least 20 new outlets in each of the past three years, accompanied by consistent increases in average transaction size and store traffic through the 2017 fiscal year.