What to Expect From Costco Earnings
Costco Wholesale is scheduled to report its fiscal first-quarter financial results after the markets close on Wednesday.
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Costco Wholesale Corp. (NASDAQ: COST) is scheduled to report its fiscal first-quarter financial results after the markets close on Wednesday. The consensus estimates call for $1.19 in earnings per share (EPS) and $28.3 billion in revenue. The same period of last year reportedly had EPS of $1.09 and $27.22 billion in revenue.
The company reported that November same-store sales, including gasoline sales and foreign exchange effects, rose 1% in the United States and in Canada but fell 2% internationally. Globally, same-store sales rose 1% compared with November 2015. Excluding gasoline and currency exchange effects, U.S. sales rose 1%, Canadian sales rose 3% and international sales rose 4%. On the same basis, worldwide same-stores sales in the quarter rose 2%. Net sales for the month totaled $9.95 billion, up 3% year over year. Retail Metrics had projected a same-store sales increase of 1.3% (up 1.1% excluding gasoline sales).
There is a reasonable chance that Costco will raise its membership fees early in 2017, if not a little sooner. In 2011 the company boosted its basic fee by $5, and since then membership renewals have been running at around 85% to 90%. A similarly sized increase is not likely to send customers fleeing. Costco’s new credit card deal with Visa also could help boost memberships.
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A few analysts weighed in on Costco ahead of the earnings report:
- Cowen has a Buy rating with a $170 price target.
- Deutsche Bank has a Buy rating with a $194 price target.
- Credit Suisse has an Outperform rating with a $165 price target.
- Nomura has a Buy rating with a $185 price target.
- Guggenheim has a Neutral rating.
- Robert Baird has a Buy rating with a $175 price target.
- JPMorgan reiterated a Buy rating with a $171 price target.
So far in 2016, Costco has underperformed the broad markets, with the stock down about 7%.
Shares of Costco were trading at $150.61 on Wednesday, with a consensus analyst price target of $169.08 and a 52-week trading range of $138.57 to $169.59.
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Chris Lange is a financial and geopolitical writer with more than a decade of experience covering a myriad of topics. He has published thousands of articles for 24/7 Wall St., with past coverage focused heavily on stocks, IPOs, healthcare, defense, global affairs, and technology.
His work has been quoted, or referenced by a number of outlets including Business Insider, USA Today, Yahoo Finance, MSN, The Motley Fool, and many other publications. A graduate of Southwestern University, he studied business with a focus on investments and has previous experience in banking and startups.
When not reading or writing the news, he is following his passion for Lacrosse, playing chess, or building solar projects with his dad.
