Retail

What to Expect From Costco Earnings

Costco Wholesale Corp. (NASDAQ: COST) is scheduled to report its fiscal third-quarter financial results Wednesday after the markets close. Thomson Reuters has consensus estimates of $1.16 in earnings per share (EPS) on $26.63 billion in revenue. In the same period of the previous year, the retailer reported EPS of $1.07 and revenue of $25.79 billion.

The discount giant reported that April same-store sales, including gasoline sales and foreign exchange effects, rose 2% in the United States and fell 4% internationally. Overall, same-store sales were flat in the month. Excluding gasoline and currency exchanges, U.S. sales rose 7% and international sales rose 9%. On the same basis worldwide, sales in the quarter rose 7%. Net sales for the month totaled $8.75 billion, up 2% year-over-year. Retail Metrics had projected a same-store sales increase of 0.4% (5.1% excluding gasoline sales and foreign exchange effects).

In late April, Costco’s board of directors reauthorized a common stock repurchase program of up to $4 billion with an expiration date in April 2019. What investors should know is that the new plan effectively replaces the prior $4 billion buyback program. Where the plan gets interesting is that the expiring plan was set to end later in April, and it had an unused authorization remaining of about $2.5 billion.

The board also declared a quarterly cash dividend on its common stock, raising it from $0.355 to $0.40 per share. This is now to be $1.60 per share on an annualized basis, which generates a yield of about 1.1%.

This dividend hike does not feel like a home run, but when you add in that the company is buying back more stock it may look a bit better.

ALSO READ: 10 Stocks to Own for the Next Decade

On Wednesday morning, shares of Costco were up 1% to $144.66, in a 52-week trading range of $113.51 to $156.85. The stock has a consensus analyst price target of $155.09.

Sponsored: Tips for Investing

A financial advisor can help you understand the advantages and disadvantages of investment properties. Finding a qualified financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.

Investing in real estate can diversify your portfolio. But expanding your horizons may add additional costs. If you’re an investor looking to minimize expenses, consider checking out online brokerages. They often offer low investment fees, helping you maximize your profit.