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PriceSmart (PSMT) Q2 Earnings Meet Estimates, Sales Grow Y/Y

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PriceSmart, Inc. (PSMT - Free Report) reported second-quarter fiscal 2018 earnings of 89 cents per share, in line with the Zacks Consensus Estimate. However, earnings declined by a cent from the year-ago quarter.

Total revenues during the quarter were $839.6 million, up 5.8% year over year, supported by higher sales in net warehouse club, export and other category.
 
Segment Details

Net warehouse club sales, comprising about 97% of the total revenues, grew 5.7% year over year to $816.6 million. Export sales increased 11.8% to $9.1 million from the year-ago quarter. Membership income grew 7.6% year over year to $12.7 million. Sales from other category were $1.15 million compared with $1.01 million in the second-quarter of fiscal 2017.

Inside the Headline Numbers

PriceSmart had 40 warehouse clubs in operation as of February 2018 compared with 39 a year ago.

Total operating expenses increased 6.4% year over year to $802.2 million, courtesy of higher cost of goods sold as well as selling, general and administrative expenses of the warehouse club operations.

The company recorded operating income of $37.3 million, down from $39.4 million a year ago.

PriceSmart, Inc. Price, Consensus and EPS Surprise

 

 

First-Half Performance

Total revenues rose 4.8% to $1.6 billion from $1.5 billion in the prior-year period. Net warehouse club sales increased 4.9% to $1.6 billion from $1.5 billion in the first six months of fiscal 2017.

The company recorded operating income of $70.4 million compared with $77.8 million in the prior-year period.

Financials

Cash and cash equivalents, as of Feb 28, 2018, were $152.1 million, down from $162.4 million in fiscal 2017.

Zacks Rank & Stocks to Consider

PriceSmart carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the Retail-Wholesale space are Burlington Stores, Inc. (BURL - Free Report) , Dollar General Corporation (DG - Free Report) and Nordstrom, Inc. (JWN - Free Report) , each carrying a Zacks Rank #2 (Buy).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Burlington Stores delivered an average positive earnings surprise of 14.9% in the trailing four quarters and has a long-term earnings growth rate of 18.7%.

Dollar General has a long-term earnings growth rate of 14.6%.

Nordstrom delivered an average positive earnings surprise of 16.8% in the trailing four quarters.

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