A panic-buying of sorts over the rapid spread of the novel coronavirus in the US has sent American customers rushing to Costco stores to stock up on bottled water, disinfectants, toilet paper, food, and other basic necessities.
Videos and photos of long lines of anxious customers that stretched outside Costco stores and parking, lots have been shared on social media over the weekend. Wall Street analysts are already expecting the company's sales to spike, as a result, sending shares on the stock market soaring.
According to Oppenheimer market strategist Rupesh Parikh, they have observed, based on their conversations with store workers and management, "a strong increase in traffic" starting Friday.
The stock of Costco Wholesale rallied 8 percent after customers filled the retail chain's parking lots all weekend to brace for possible quarantines, now that the virus has started to make its way in the US mainland.
Costco was down 12 percent last week, as a result of worries in the global market. But investors are clearly warming to the notion that the company and other retailers are well-suited to attract more customers looking to bulk up on imported goods before the shelves run out.
People have been sharing photos of empty shelves on Twitter and Facebook at different retail branches, including Walmart, Target and Home Depot. Customers have reported shortages in Washington, California, Minnesota, New York, and Hawaii.
The stock had settled Friday down a little more than 4 percent, in the midst of a wider market sell-off. Stocks have bounced back over 38 percent in the last four quarters. Costco has a market cap of more than $123 billion, data by FactSet showed.
Costco has had a good track record of handling stock shortages, analysts said, which bodes well for the company in customers' mindsets, when they are thinking of where to buy stuff in a pinch. A good number of consumers are seemingly prepping for the coronavirus to become more widespread in the US. A second coronavirus death in Washington state was confirmed on Sunday.
Across the US, sales of hand sanitizers are skyrocketing 74 percent for the four weeks ended Feb 22, based on figures compiled by Nielsen. Sales of medical masks have also exploded to a whopping 320 percent. Nielsen said it doesn't anticipate hand sanitizer sales to peak "for some time."
A Costco branch in Oregon state ran out of toilet paper stocks for the first time in the shop's history, according to a local report. Costco is scheduled to post earnings and sales this Thursday, after the stock market closes.
