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Factors to Know Ahead of Costco's (COST) Q1 Earnings Release
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Costco Wholesale Corporation (COST - Free Report) is likely to register an increase in the top line when it reports first-quarter fiscal 2024 results on Dec 14 after the closing bell. The Zacks Consensus Estimate for revenues is pegged at $57.62 billion, indicating growth of 5.8% from the prior-year reported figure.
The bottom line of this Issaquah, WA-based company is anticipated to have improved year over year. The Zacks Consensus Estimate for first-quarter earnings per share has risen by a penny to $3.44 over the past 30 days, which suggests an increase of 11% from the year-ago period.
Costco has a trailing four-quarter earnings surprise of 2.1%, on average. In the last reported quarter, the company’s bottom line outperformed the Zacks Consensus Estimate by 3.2%.
Key Factors to Note
Costco’s growth strategies, better price management and decent membership trends have been contributing to its performance. The company’s strategy to sell products at discounted prices has helped attract customers who have been seeking both value and convenience. These factors, complemented by reduced supply-chain costs and an increasing penetration of private-label brands, are expected to have a positive impact on the overall results.
For the quarter in focus, we anticipate an impressive 5.5% jump in net sales and a 5.2% increase in total membership fees. Costco's paid membership base has been witnessing a steady rise, driven by a growing customer base and remarkable renewal rates. We also project 4.1% growth in comparable sales for the first quarter.
However, it is essential to acknowledge the presence of certain headwinds, including underlying inflationary pressures and a high interest rate environment, which may pose challenges. Additionally, margins remain a critical area to monitor, with potential concerns stemming from any deleverage in the SG&A rate, higher labor and occupancy costs, and increased marketing and other store-related expenses.
Costco Wholesale Corporation Price, Consensus and EPS Surprise
Our proven model predicts an earnings beat for Costco this time. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat, which is the case here.
Costco has an Earnings ESP of +1.40% and a Zacks Rank #3. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
3 Other Stocks With the Favorable Combination
Here are three companies you may want to consider as our model shows that these also have the right combination of elements to post an earnings beat:
Dollar Tree (DLTR - Free Report) currently has an Earnings ESP of +0.25% and a Zacks Rank #3. The company is likely to register a bottom-line increase when it reports fourth-quarter fiscal 2023 numbers. The Zacks Consensus Estimate for the quarterly earnings per share of $2.65 suggests an increase from $2.04 reported in the year-ago quarter. You can see the complete list of today’s Zacks #1 Rank stocks here.
Dollar Tree’s top line is expected to increase year over year. The Zacks Consensus Estimate for quarterly revenues is pegged at $8.67 billion, which indicates a rise of 12.4% from the figure reported in the prior-year quarter.
Ross Stores (ROST - Free Report) currently has an Earnings ESP of +0.14% and a Zacks Rank #3. The company is likely to register a bottom-line increase when it reports fourth-quarter fiscal 2023 numbers. The Zacks Consensus Estimate for the quarterly earnings per share of $1.62 suggests an increase of 23.7% from the year-ago quarter.
Ross Stores’ top line is expected to ascend year over year. The Zacks Consensus Estimate for quarterly revenues is pegged at $5.75 billion, which indicates an increase of 10.2% from the figure reported in the prior-year quarter. Ross Stores has a trailing four-quarter earnings surprise of 7.8%, on average.
Target (TGT - Free Report) currently has an Earnings ESP of +0.37% and a Zacks Rank #3. The company is likely to register a bottom-line increase when it reports fourth-quarter fiscal 2023 numbers. The Zacks Consensus Estimate for the quarterly earnings per share of $2.38 suggests an increase of 25.9% from the year-ago quarter.
Target’s top line is expected to rise year over year. The Zacks Consensus Estimate for quarterly revenues is pegged at $31.88 billion, which indicates an increase of 1.6% from the figure reported in the prior-year quarter. Target has a trailing four-quarter earnings surprise of 30.8%, on average.
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Factors to Know Ahead of Costco's (COST) Q1 Earnings Release
Costco Wholesale Corporation (COST - Free Report) is likely to register an increase in the top line when it reports first-quarter fiscal 2024 results on Dec 14 after the closing bell. The Zacks Consensus Estimate for revenues is pegged at $57.62 billion, indicating growth of 5.8% from the prior-year reported figure.
The bottom line of this Issaquah, WA-based company is anticipated to have improved year over year. The Zacks Consensus Estimate for first-quarter earnings per share has risen by a penny to $3.44 over the past 30 days, which suggests an increase of 11% from the year-ago period.
Costco has a trailing four-quarter earnings surprise of 2.1%, on average. In the last reported quarter, the company’s bottom line outperformed the Zacks Consensus Estimate by 3.2%.
Key Factors to Note
Costco’s growth strategies, better price management and decent membership trends have been contributing to its performance. The company’s strategy to sell products at discounted prices has helped attract customers who have been seeking both value and convenience. These factors, complemented by reduced supply-chain costs and an increasing penetration of private-label brands, are expected to have a positive impact on the overall results.
For the quarter in focus, we anticipate an impressive 5.5% jump in net sales and a 5.2% increase in total membership fees. Costco's paid membership base has been witnessing a steady rise, driven by a growing customer base and remarkable renewal rates. We also project 4.1% growth in comparable sales for the first quarter.
However, it is essential to acknowledge the presence of certain headwinds, including underlying inflationary pressures and a high interest rate environment, which may pose challenges. Additionally, margins remain a critical area to monitor, with potential concerns stemming from any deleverage in the SG&A rate, higher labor and occupancy costs, and increased marketing and other store-related expenses.
Costco Wholesale Corporation Price, Consensus and EPS Surprise
Costco Wholesale Corporation price-consensus-eps-surprise-chart | Costco Wholesale Corporation Quote
What the Zacks Model Unveils
Our proven model predicts an earnings beat for Costco this time. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat, which is the case here.
Costco has an Earnings ESP of +1.40% and a Zacks Rank #3. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
3 Other Stocks With the Favorable Combination
Here are three companies you may want to consider as our model shows that these also have the right combination of elements to post an earnings beat:
Dollar Tree (DLTR - Free Report) currently has an Earnings ESP of +0.25% and a Zacks Rank #3. The company is likely to register a bottom-line increase when it reports fourth-quarter fiscal 2023 numbers. The Zacks Consensus Estimate for the quarterly earnings per share of $2.65 suggests an increase from $2.04 reported in the year-ago quarter. You can see the complete list of today’s Zacks #1 Rank stocks here.
Dollar Tree’s top line is expected to increase year over year. The Zacks Consensus Estimate for quarterly revenues is pegged at $8.67 billion, which indicates a rise of 12.4% from the figure reported in the prior-year quarter.
Ross Stores (ROST - Free Report) currently has an Earnings ESP of +0.14% and a Zacks Rank #3. The company is likely to register a bottom-line increase when it reports fourth-quarter fiscal 2023 numbers. The Zacks Consensus Estimate for the quarterly earnings per share of $1.62 suggests an increase of 23.7% from the year-ago quarter.
Ross Stores’ top line is expected to ascend year over year. The Zacks Consensus Estimate for quarterly revenues is pegged at $5.75 billion, which indicates an increase of 10.2% from the figure reported in the prior-year quarter. Ross Stores has a trailing four-quarter earnings surprise of 7.8%, on average.
Target (TGT - Free Report) currently has an Earnings ESP of +0.37% and a Zacks Rank #3. The company is likely to register a bottom-line increase when it reports fourth-quarter fiscal 2023 numbers. The Zacks Consensus Estimate for the quarterly earnings per share of $2.38 suggests an increase of 25.9% from the year-ago quarter.
Target’s top line is expected to rise year over year. The Zacks Consensus Estimate for quarterly revenues is pegged at $31.88 billion, which indicates an increase of 1.6% from the figure reported in the prior-year quarter. Target has a trailing four-quarter earnings surprise of 30.8%, on average.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.