Shares of Costco (COST - Free Report) surged to a new high Friday morning after it released August and fiscal year sales figures that highlighted the retail powerhouse’s growing e-commerce business. So let’s take a look at what investors should make of Costco stock as it thrives amid increased competition from Walmart (WMT - Free Report) , Target (TGT - Free Report) , and Amazon (AMZN - Free Report) .
Recent Results
Costco’s August net sales jumped 12.2% from $9.8 billion in the year-ago period to hit $11.0 billion. Meanwhile, the company posted net sales of $43.4 billion in its 16-week fiscal fourth-quarter, which marked a 5% jump.
Investors should also note that Costco released its full fiscal year net sales figures as well. The big-box giant saw its net sales surge 9.7% from $126.2 billion in the 53-week fiscal year 2017 to reach $138.4 billion in its 52-week fiscal 2018.
More specifically, Costco’s U.S. sales jumped 10.8% in the fourth quarter and 9.4% for the year. Plus, the company’s e-commerce sales surged 26.2% for the quarter and 32.2% in fiscal 2018. It is worth noting that these growth figures include impacts from changes in gasoline prices and inflation, which had a positive impact on U.S., Canadian and international sales.
Overview
Still, Costco’s e-commerce strength was impressive once again. The company saw its e-commerce sales jump 36.8% during its fiscal third quarter. Costco has been able to lift its e-commerce sales through a series of initiatives. This includes the launch of CostcoGrocery last fall, which offers two-day delivery for non-perishable food and household supplies to customers nationwide.
Costco also expanded its same-day delivery service to “most metropolitan” areas through an updated partnership with Instacart. Costco’s successful jump into e-commerce will help it better compete with rivals Target and Walmart, which both posted impressive quarterly results recently.
In fact, Walmart’s second-quarter U.S. comparable store sales popped 4.5% and its e-commerce sales soared by 40%. Walmart noted that it posted its highest domestic same-store sales growth in more than 10 years.
Outlook
Costco’s continued e-commerce expansion looks poised to help the company become more profitable. Our current Zacks Consensus Estimate is calling for the firm’s adjusted fiscal fourth-quarter earnings to jump by 11.06% to hit $2.31 per share. Costco’s fiscal year earnings are projected to surge by over 20%.
The company has also earned six positive earnings estimate revisions for both Q4 and it current fiscal year over the last 60 days, against zero downward changes. COST is currently a Zacks Rank #3 (Hold) and sports an “A” grade for Growth in our Style Scores system.
Shares of COST popped over 2.3% in mid-morning trading to rest near their new 52-week and all-time high of $242.12 per share. Therefore, it might not be the best time to buy Costco stock at the moment, but it is certainly worth keeping an eye on for a better buying opportunity.
Costco is set to report its official Q4 and full-year financial results in early October.
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Shares of Costco (COST - Free Report) surged to a new high Friday morning after it released August and fiscal year sales figures that highlighted the retail powerhouse’s growing e-commerce business. So let’s take a look at what investors should make of Costco stock as it thrives amid increased competition from Walmart (WMT - Free Report) , Target (TGT - Free Report) , and Amazon (AMZN - Free Report) .
Recent Results
Costco’s August net sales jumped 12.2% from $9.8 billion in the year-ago period to hit $11.0 billion. Meanwhile, the company posted net sales of $43.4 billion in its 16-week fiscal fourth-quarter, which marked a 5% jump.
Investors should also note that Costco released its full fiscal year net sales figures as well. The big-box giant saw its net sales surge 9.7% from $126.2 billion in the 53-week fiscal year 2017 to reach $138.4 billion in its 52-week fiscal 2018.
More specifically, Costco’s U.S. sales jumped 10.8% in the fourth quarter and 9.4% for the year. Plus, the company’s e-commerce sales surged 26.2% for the quarter and 32.2% in fiscal 2018. It is worth noting that these growth figures include impacts from changes in gasoline prices and inflation, which had a positive impact on U.S., Canadian and international sales.
Overview
Still, Costco’s e-commerce strength was impressive once again. The company saw its e-commerce sales jump 36.8% during its fiscal third quarter. Costco has been able to lift its e-commerce sales through a series of initiatives. This includes the launch of CostcoGrocery last fall, which offers two-day delivery for non-perishable food and household supplies to customers nationwide.
Costco also expanded its same-day delivery service to “most metropolitan” areas through an updated partnership with Instacart. Costco’s successful jump into e-commerce will help it better compete with rivals Target and Walmart, which both posted impressive quarterly results recently.
In fact, Walmart’s second-quarter U.S. comparable store sales popped 4.5% and its e-commerce sales soared by 40%. Walmart noted that it posted its highest domestic same-store sales growth in more than 10 years.
Outlook
Costco’s continued e-commerce expansion looks poised to help the company become more profitable. Our current Zacks Consensus Estimate is calling for the firm’s adjusted fiscal fourth-quarter earnings to jump by 11.06% to hit $2.31 per share. Costco’s fiscal year earnings are projected to surge by over 20%.
The company has also earned six positive earnings estimate revisions for both Q4 and it current fiscal year over the last 60 days, against zero downward changes. COST is currently a Zacks Rank #3 (Hold) and sports an “A” grade for Growth in our Style Scores system.
Shares of COST popped over 2.3% in mid-morning trading to rest near their new 52-week and all-time high of $242.12 per share. Therefore, it might not be the best time to buy Costco stock at the moment, but it is certainly worth keeping an eye on for a better buying opportunity.
Costco is set to report its official Q4 and full-year financial results in early October.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.
Click here for the 6 trades >>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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