We recently published a list of 10 Low Volatility Stocks to Buy According to Billionaire Ken Fisher In this article, we are going to take a look at where Costco Wholesale Corporation (NASDAQ:COST) stands against other low volatility stocks to buy according to billionaire Ken Fisher.
Billionaire Ken Fisher, a prominent money manager, renowned author, and financial analyst, is the founder of Fisher Asset Management. Fisher founded his hedge firm in 1979 and was CEO until 2016 when he stepped down. Currently, he serves as Fisher Investments’ Executive Chairman and co-chief investment officer alongside Jeff Silk. The billionaire’s net worth is believed to be more than $11.2 billion, making him one of the wealthiest Americans and billionaires in the world. Known for his emphasis on long-term investment, Fisher also believes in diversification to reduce risk. To that end, Fisher Asset Management holds a highly diversified portfolio worth around $244 billion, with technology equities accounting for 31.8% of its assets.
Fisher Asset Management’s investing strategy is based on Ken Fisher’s conviction in capitalism and free markets, where securities prices are determined by supply and demand. The firm uses market research and key criteria such as the price-to-sales ratio to identify undervalued growth stocks. It asserts that securities prices are solely determined by supply and demand, and that capital markets accurately represent generally known facts.
Fisher’s 2025 Outlook
Fisher recently highlighted three potential trajectories for global equities in 2025, emphasizing that some factors—such as central bank rate reduction, GDP reporting, profitability, climate change, and Big Tech antitrust cases—will not influence their estimates. According to the billionaire, central banks’ activities follow market developments instead of driving them. Similarly, long-term issues such as peak oil consumption, demographic upheavals, and regulatory conflicts have little effect on stock prices in the near term. In addition, he believes that current political developments may affect emotion but not long-term market direction. Instead, bull markets collapse owing to either blind enthusiasm or an unanticipated economic shock with a global effect.
Speaking on President Trump’s tariffs specifically, Ken Fisher believes that the global economy and stock market will stay robust despite worries, stating:
“Market volatility can feel unsettling. However, selling stocks during a downturn can lead to missing out on gains if the market rebounds, which we believe will happen this year. While so far, President Trump has proposed larger tariffs this year than in 2018 to 2019, they may not be fully implemented or remain in effect as long as expected. Even if they do, businesses are also highly adaptable and find ways to adjust to shifting economic policies which can mitigate the longer term damage some fear. All in all, we still see a strong case for global economic growth ahead, despite tariffs, which should continue to support this bull market.”
Our Methodology
For this article, we picked companies from Fisher Asset Management’s 13F portfolio as of the end of the fourth quarter of 2024. The following firms have low beta values (<1), consistent dividend histories, and robust businesses. Additionally, we have mentioned the hedge fund sentiment around each stock, as of Q4 2024.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
A customer in a warehouse aisles, browsing the wide range of branded and private-label products.
Costco Wholesale Corporation (NASDAQ:COST)
Beta Value: 0.97
Dividend Yield: 0.51%
Fisher Asset Management’s Q4 Stake: $2.82 billion
Number of Hedge Fund Holders: 96
Costco Wholesale Corporation (NASDAQ:COST) is a membership-based warehouse club that offers bulk prices on a wide range of products including food, electronics, and household supplies. The devotion of its members fuels the company’s development, with membership fees accounting for a significant portion of its income. Costco Wholesale Corporation (NASDAQ:COST) reported that non-foods were up in the low teens in February, with jewelry, gift cards, and housewares outperforming other departments.
On March 13, DA Davidson reaffirmed its Neutral rating on Costco Wholesale Corporation (NASDAQ:COST) shares, with a price target of $1,000. The firm’s analyst, Michael Baker, attended the grand opening of Costco’s 900th club in Sharon, Massachusetts, the state’s first new Costco store in 23 years. Costco CEO Ron Vachris stated that the corporation is looking into future expansion in the region, with plans to establish up to four more clubs. This development plan is consistent with the company’s impressive sales growth, which reached $264 billion in the last 12 months and has maintained a respectable 11% compound annual growth rate over the last five years.
Aoris Investment Management stated the following regarding Costco Wholesale Corporation (NASDAQ:COST) in its Q4 2024 investor letter:
“Firstly, I think we exercised good valuation discipline in our sales of Costco Wholesale Corporation (NASDAQ:COST) and Cintas. The share prices of these two companies had increased by more than 60% and 40% respectively in the year prior to our sale. It can be difficult as investors to remain objective and not ‘fall in love’ with an investment when it is performing well. A higher share price doesn’t make a business more valuable!
We sold both Costco and Cintas simply for reasons of valuation. These are exceptional businesses that we’d love to own again if valuation permits. Their sales allowed us to recycle portfolio capital into more attractively valued businesses.”
Overall, COST ranks 7th on our list of low volatility stocks to buy according to billionaire Ken Fisher. While we acknowledge the potential of COST as an investment, our conviction lies in the belief that certain AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than COST but trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.
Disclosure: None. This article is originally published at Insider Monkey.
