Costco Stock Options Hot After Membership Price Change

The security attracted no fewer than eight price-target hikes

Costco Wholesale Corporation (NASDAQ:COST) yesterday raised membership prices in North America for the first time since 2017. Starting in September, “Gold Star” memberships in the U.S. and Canada will cost $65 instead of $60, while the “Executive” memberships will go up to $120 to $130. Plus, the maximum annual 2% reward moved higher to $1,250 from $1,000. The stock attracted no fewer than eight price-target hikes in response, with the highest coming from Jefferies to $1,050 from $860.

Shares were last seen down 3.1% to trade at $856.33 at last check, erasing premarket gains. The equity is fresh off a July 9, all-time high $896.67, with support from its 20-day moving average ready to contain today’s pullback. So far in 2024, COST is up over 29%.

An unwinding of pessimism in the options pits could create additional tailwinds for Costco stock. This is per the security’s International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) 50-day put/call volume ratio of 1.02, which stands in the 98th percentile of readings from the past 12 months.

So far today, 41,000 calls and 23,000 puts have exchanged hands, which is five times the intraday average volume. The most popular contract is the weekly 7/12 900-strike call, with positions being sold-to-open opened there.

It’s also worth noting the security boasts attractively priced premiums. This is per its Schaeffer’s Volatility Indexes (SVI) of 19% that ranks in the 14th percentile of annual readings.

Leave a Reply

Your email address will not be published. Required fields are marked *