Jim Cramer backs Costco amid September market challenges

On September 6, 2024, CNBC's Jim Cramer recommended Costco stock as a safe investment amid a challenging market environment, particularly in September, which is historically known for volatility. Cramer's endorsement followed a strong sales report from Costco, which revealed a 7.1% increase in net sales year-over-year, totaling $19.83 billion for the four weeks ending September 1. This performance exceeded analysts' expectations of a 6.7% increase, showcasing solid growth across various product categories, including food and sundries, fresh foods, and non-food items. Cramer emphasized Costco's competitive pricing strategy, noting that the retailer's ability to negotiate favorable terms with suppliers allows it to offer unbeatable prices to its members. This pricing strategy has resonated well with consumers, even after a recent increase in membership fees. The strong sales figures prompted several Wall Street firms to raise their price targets for Costco stock, with Evercore ISI increasing its target to $925 per share and Loop Capital adjusting its target to $975. As the S&P 500 and Nasdaq indices faced significant declines, Cramer urged investors to consider Costco as a reliable option during this turbulent period. He highlighted the retailer's resilience and strong performance as key reasons for his recommendation. Investors are also looking forward to Costco's fiscal 2024 fourth-quarter earnings report, scheduled for September 26, which will provide further insights into the company's financial health and market position. Overall, Cramer's advocacy for Costco reflects a broader trend of seeking stability in uncertain market conditions, with the retailer's strong sales performance and competitive pricing making it an attractive choice for investors seeking refuge from market volatility.