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Costco (COST) Flourishes on Decent Sales & Comps Trend
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Costco Wholesale Corporation (COST - Free Report) has time and again proved its mettle. The company has weathered multiple market gyrations and still delivered returns to investors. Strategic investments, customer-centric approach, merchandise initiatives and emphasis on memberships have been the discount retailer’s primary strengths. These have helped post consistent sales growth.
Impressively, Costco has outpaced both the Retail - Discount Stores industry and the Retail-Wholesale sector in the past year. We note that shares of this Zacks Rank #2 (Buy) company have appreciated 44.5% in the past year compared with the industry’s growth of 15.5%. Meanwhile, the sector has declined 22.1%.
Stellar Sales Run
Costco’s growth strategies, better price management, decent membership trends and increasing penetration of e-commerce business have been contributing to its upbeat performance. Cumulatively, these factors have been aiding this Issaquah, WA-based company in registering impressive sales numbers.
Costco’s net sales increased 15.5% to $15.76 billion for the retail month of January — the four-week period ended Jan 30, 2022 — from $13.64 billion in the last year. This followed improvements of 16.2%, 15.7% and 19.2% in December, November and October, respectively.
Management informed that earlier Lunar New Year/Chinese New Year in 2022 positively impacted January’s Other International and total sales by about 4% and 0.5%, respectively. Lunar New Year occurred on Feb 1, 2022, 11 days earlier than in 2021.
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Solid Comparable Sales Trend
Comparable sales for the retail month of January jumped 14.2%. This followed increases of 14.5%, 14.1% and 17.5%, in December, November and October, respectively. Comparable sales for January reflect an improvement of 14.1%, 17.8% and 11.8% in the United States, Canada and Other International locations, respectively.
Excluding the impacts of changes in gasoline prices and foreign exchange, comparable sales for the month under discussion rose 10.8% on improvements of 9.5%, 13.9% and 14.6% in the United States, Canada and Other International locations, respectively.
E-Commerce on the Rise
Costco has been rapidly adopting the omni-channel mantra in a bid to provide a seamless shopping experience, both online and at stores. The company has been gradually expanding its e-commerce capabilities in the United States, Canada, the U.K., Mexico, Korea, Taiwan, Japan, and Australia.
We note that comparable e-commerce sales rose 9% in January. This followed increases of 17.8, 12.2% and 16.5% in December, November and October, respectively. Costco Logistics has bolstered e-commerce capabilities and facilitated the selling of "big and bulky" items.
Wrapping Up
Costco continues to be one of the dominant warehouse retailers based on the expanse and quality of merchandise offered. It is focused on ramping up investments in the wake of rising competition. We believe that the company’s business model as well as a commitment toward opening membership warehouses, and providing convenient and affordable ways to shop will continue to drive traffic, and in turn revenues.
Albertsons Companies, a leading food and drug retailer in the United States, sports a Zacks Rank #1 (Strong Buy). The company has a trailing four-quarter earnings surprise of 31.8%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Albertsons Companies’ current financial year sales suggests growth of 1.6% from the year-ago period. ACI has an expected EPS growth rate of 8% for three-five years.
Tapestry, which provides luxury accessories and branded lifestyle products, carries a Zacks Rank #2. The company has a trailing four-quarter earnings surprise of 29%, on average.
The Zacks Consensus Estimate for Tapestry’s current financial year sales and EPS suggests growth of 15% and 18.5%, respectively, from the year-ago period. TPR has an expected EPS growth rate of 12.3% for three-five years.
Dollar Tree, which operates discount variety retail stores, carries a Zacks Rank #2. The company has a trailing four-quarter earnings surprise of 8.8%, on average.
The Zacks Consensus Estimate for Dollar Tree’s current financial year sales suggests growth of 3.4% from the year-ago period. DLTR has an expected EPS growth rate of 12.2% for three-five years.
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Costco (COST) Flourishes on Decent Sales & Comps Trend
Costco Wholesale Corporation (COST - Free Report) has time and again proved its mettle. The company has weathered multiple market gyrations and still delivered returns to investors. Strategic investments, customer-centric approach, merchandise initiatives and emphasis on memberships have been the discount retailer’s primary strengths. These have helped post consistent sales growth.
Impressively, Costco has outpaced both the Retail - Discount Stores industry and the Retail-Wholesale sector in the past year. We note that shares of this Zacks Rank #2 (Buy) company have appreciated 44.5% in the past year compared with the industry’s growth of 15.5%. Meanwhile, the sector has declined 22.1%.
Stellar Sales Run
Costco’s growth strategies, better price management, decent membership trends and increasing penetration of e-commerce business have been contributing to its upbeat performance. Cumulatively, these factors have been aiding this Issaquah, WA-based company in registering impressive sales numbers.
Costco’s net sales increased 15.5% to $15.76 billion for the retail month of January — the four-week period ended Jan 30, 2022 — from $13.64 billion in the last year. This followed improvements of 16.2%, 15.7% and 19.2% in December, November and October, respectively.
Management informed that earlier Lunar New Year/Chinese New Year in 2022 positively impacted January’s Other International and total sales by about 4% and 0.5%, respectively. Lunar New Year occurred on Feb 1, 2022, 11 days earlier than in 2021.
Solid Comparable Sales Trend
Comparable sales for the retail month of January jumped 14.2%. This followed increases of 14.5%, 14.1% and 17.5%, in December, November and October, respectively. Comparable sales for January reflect an improvement of 14.1%, 17.8% and 11.8% in the United States, Canada and Other International locations, respectively.
Excluding the impacts of changes in gasoline prices and foreign exchange, comparable sales for the month under discussion rose 10.8% on improvements of 9.5%, 13.9% and 14.6% in the United States, Canada and Other International locations, respectively.
E-Commerce on the Rise
Costco has been rapidly adopting the omni-channel mantra in a bid to provide a seamless shopping experience, both online and at stores. The company has been gradually expanding its e-commerce capabilities in the United States, Canada, the U.K., Mexico, Korea, Taiwan, Japan, and Australia.
We note that comparable e-commerce sales rose 9% in January. This followed increases of 17.8, 12.2% and 16.5% in December, November and October, respectively. Costco Logistics has bolstered e-commerce capabilities and facilitated the selling of "big and bulky" items.
Wrapping Up
Costco continues to be one of the dominant warehouse retailers based on the expanse and quality of merchandise offered. It is focused on ramping up investments in the wake of rising competition. We believe that the company’s business model as well as a commitment toward opening membership warehouses, and providing convenient and affordable ways to shop will continue to drive traffic, and in turn revenues.
3 More Picks You Can’t Miss Out On
Here are three more favorably ranked stocks — Albertsons Companies (ACI - Free Report) , Tapestry (TPR - Free Report) and Dollar Tree (DLTR - Free Report) .
Albertsons Companies, a leading food and drug retailer in the United States, sports a Zacks Rank #1 (Strong Buy). The company has a trailing four-quarter earnings surprise of 31.8%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Albertsons Companies’ current financial year sales suggests growth of 1.6% from the year-ago period. ACI has an expected EPS growth rate of 8% for three-five years.
Tapestry, which provides luxury accessories and branded lifestyle products, carries a Zacks Rank #2. The company has a trailing four-quarter earnings surprise of 29%, on average.
The Zacks Consensus Estimate for Tapestry’s current financial year sales and EPS suggests growth of 15% and 18.5%, respectively, from the year-ago period. TPR has an expected EPS growth rate of 12.3% for three-five years.
Dollar Tree, which operates discount variety retail stores, carries a Zacks Rank #2. The company has a trailing four-quarter earnings surprise of 8.8%, on average.
The Zacks Consensus Estimate for Dollar Tree’s current financial year sales suggests growth of 3.4% from the year-ago period. DLTR has an expected EPS growth rate of 12.2% for three-five years.