Favorable job scenario, increasing disposable income and improved consumer confidence are responsible for a favorable retail environment. And Costco Wholesale Corporation (COST - Free Report) has been a beneficiary of the same. Certainly, the company’s better price management, strong membership trends and increasing penetration of e-commerce business are also leading to impressive comparable sales (comps) run that may continue in 2019.
This operator of membership warehouses reported comps for the month of December. The metric increased 6.1% for the five-week period ended Jan 6, 2019. This follows an increase of 9.2% in November, 8.6% in October, 8.4% in September, 9.2% in August and 8.3% in July. Comps for December reflect an increase of 7.5%, 2% and 2.8% in the United States, Canada and Other International locations, respectively.
Excluding the impact of foreign currency fluctuations, gasoline prices and accounting change concerning revenue recognition (ASC 606), comps for the month rose 7%, while the same increased 7.1%, 8.1% and 5.7% in the United States, Canada and Other International locations, respectively.
Meanwhile, net sales improved 7.8% to $15.42 billion in the month under review, following an increase of 9.8%, 10.6%, 10.3%, 12.2%, and 10.1% in November, October, September, August and July, respectively.
For the 18 weeks ended Jan 6, 2019, net sales came in at $52.99 billion, up about 9.5% from $48.39 billion reported in the year-ago period. Comps for the period grew 7.9%, while the same increased 10%, 2.1% and 3.3% in the United States, Canada and Other International locations, respectively.
Costco is also steadily expanding e-commerce capabilities in the United States, Canada, the U.K., Mexico, Korea and Taiwan. E-commerce comparable sales rose 13.6%, 46.1%, 20%, 28.6%, 23.8% and 20.9% in the months of December, November, October, September, August and July, respectively.
Costco, which shares space with Walmart (WMT - Free Report) , Target (TGT - Free Report) and Ross Stores (ROST - Free Report) , continues to be one of the dominant warehouse retailers based on the breadth and quality of merchandise offered. In fact, its strategy of selling products at heavily discounted prices has helped it to remain on growth track. In a year, shares of this Zacks Rank #3 (Hold) company have increased 10.8%, outperforming the industry’s rise of 9.3%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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