Why Now is the Time to Get Bullish on Costco: Insights from Danielle Shay
At Extreme Investor Network, we understand that timing and strategy are everything when it comes to investing. Recently, Danielle Shay, the vice president of options at Simpler Trading, shared powerful insights about Costco during her appearance on CNBC’s "Power Lunch." Her analysis aligns perfectly with our philosophy of seizing market opportunities wisely. Let’s dive deeper into why Costco might just be the stock to watch in the upcoming years.
The Case for Costco
Costco, the wholesale retail giant, has made a significant mark in the investing world. Shay, who participated in the 2025 CNBC Stock Draft, highlighted Costco as her top pick. Despite a minor dip of over 1% this week, she remains bullish on the stock, citing the impressive technical patterns and fundamentals that back her sentiment.
Technical Analysis: The Bullish Cup-and-Handle Pattern
Shay pointed out that a careful analysis of Costco’s weekly chart reveals a striking cup-and-handle pattern—a formation that many traders celebrate as a bullish signal. The stock’s price moved upwards, corrected, then established a solid base before resuming its upward trajectory. This sequence suggests that Costco has potentially set itself up for a significant price rise, with Shay targeting a stunning $1,200 per share.
For those unfamiliar, a cup-and-handle pattern indicates a stock’s consolidation after a price increase, often leading to another leg higher. At Extreme Investor Network, we stress the importance of recognizing such patterns, as they can offer investors substantial profit opportunities when timed correctly.
The Allure of Dividends and Demand
Another compelling reason to consider Costco as part of your portfolio is its consistent dividend payments and an established reputation for value. Shay noted that during challenging times, consumers flock to retailers offering deals, positioning Costco favorably in the current economic climate. In fact, high customer traffic has consistently demonstrated its resilience, making it a solid investment option.
A Word of Caution: The Nike Dilemma
While Shay was enthusiastic about Costco, she did express reservations about Nike, deeming it the worst pick from the draft. Nike has faced a severe downturn since 2021, plummeting over 56%. Shay cautioned investors against jumping into this stock just because it appears "cheap." Instead, her advice is to short Nike if it trades between $60 to $75, warning that the trend suggests a continued decline.
This highlights an invaluable lesson at Extreme Investor Network—investors should not chase falling stocks without a solid recovery plan. Instead, looking for strength and momentum, like that exhibited by Costco, is often more rewarding.
Broadcom: A Hidden Gem
On a more positive note, Shay believes that Broadcom is one of the best names that missed selection during the draft. While it may not receive the same spotlight as AI stocks like Nvidia, Broadcom has shown significant resilience with a 48% surge in the past year, despite a 17% pullback in 2025.
With Shay setting a price target of $250 to $280, which translates to a potential 30% to 45% upside, we at Extreme Investor Network applaud the focus on undervalued assets that have solid growth potential. Investing should be a process of identifying hidden gems, and Broadcom exemplifies this.
Stay Ahead of the Curve
At Extreme Investor Network, we believe in empowering investors with timely and actionable insights. Understanding market trends, recognizing technical patterns, and knowing when to pivot to stronger stocks can set you apart in the investing game. As the markets fluctuate, continue refining your strategies and remain open to new opportunities—Costco may just be the beginning of a strong investment journey.
Join us as we keep an eye on economic indicators, retail trends, and other investment opportunities that the market has to offer. For more insights, tools, and discussions, keep coming back to Extreme Investor Network—where strategic investing comes to life!