198.20 +0.06 (0.03%)
After hours: 7:59PM EDT
|Bid||198.00 x 900|
|Ask||198.20 x 900|
|Day's Range||196.77 - 198.69|
|52 Week Range||150.00 - 201.77|
|PE Ratio (TTM)||29.53|
|Earnings Date||May 31, 2018|
|Forward Dividend & Yield||2.28 (1.16%)|
|1y Target Est||210.13|
Yahoo Finance's Alexis Christoforous and Jared Blikre break down the latest market action after Lowe's Companies reported Q1 2018 earnings.
Besides outperforming Walmart (WMT) and Target (TGT) with its earnings growth rate, Costco (COST) is also exceeding its peers on the sales front due to its stellar comps growth. Analysts expect Costco to report sales of $31.9 billion in the fiscal third quarter—up 10.5% on a YoY (year-over-year) basis.
The grocery and retail sector is a crowded one with large warehouse outfits like BJ’s Wholesale Club, which filed for an initial public offering on the New York Stock Exchange last week, occupying a section with strong business attributes. BJ’s Wholesale, which will trade under the ticker symbol “BJ,” is a membership-based shopping warehouse chain that competes with stores like Costco Wholesale Corp. (COST) and Walmart Inc.’s (WMT) Sam’s Club. Analysts have highlighted the competitive moat between Costco and Amazon.com Inc. (AMZN) , with UBS analysts writing in a note from early May that Costco has a price advantage over both Sam’s Club and Amazon.
Costco (COST) has impressed investors with its strong bottom-line performance in the past four quarters. For the fiscal third quarter, analysts expect Costco to sustain the momentum and mark strong double-digit growth in its EPS (earnings per share). Costco’s earnings grew 21.4%, 16.2%, 17.5%, and 12.9% in fiscal Q4 2017, Q3 2017, Q2 2017, and Q1 2017, respectively.
Costco Wholesale Corporation (NASDAQ:COST) survived the retail apocalypse relatively unscathed, but should BJ’s IPO have Costco — and COST stockholders — spooked? Last week, BJ’s Wholesale Club announced that it would be coming back onto the public market after a seven year hiatus during which the firm’s private equity owners Leonard Green & Partners and CVC Capital Partners say they expanded the company and prepared it to compete in the increasingly competitive retail space. The BJ’s IPO has shined a spotlight on wholesale retailers like Costco and Walmart Inc’s (NYSE:WMT) Sam’s Club.
Costco (COST) is scheduled to announce its fiscal third-quarter results on May 31. Analysts expect Costco to sustain its strong sales and earnings growth momentum and report double-digit growth.
Every interested investor wants to achieve the equivalent of buying Facebook Inc (NASDAQ:FB) when it fell below $20 per share or picking up Microsoft Corporation (NASDAQ:MSFT) at the time of its 1986 IPO. Investors will serve themselves well by avoiding these pieces of bad investment advice. No matter how much research one does or how adept investors become at analyzing financial statements and charts, the single biggest challenge every investor faces is emotion.
In the case of BJ’s Wholesale Club, you had better think twice about buying. The company was taken private by CVC Capital Partners and Leonard Green & Partners in 2011, and its owners’ attempt to cash in is not backed up by rapid sales growth or strong financial performance. BJ’s (IPO:BJ) is a relatively small competitor when compared with Costco Wholesale Corp. (COST) and Walmart Inc. (WMT) unit Sam’s Club.
Target ( TGT) is a discount retailer, which means that it generates revenue by offering competitively priced consumer goods. Similar companies competing directly with Target include Wal-Mart Stores ( WMT) and Costco Wholesale ( COST). Target is another retailer that has come under pressure due to Amazon's (AMZN) growing dominance.
Target (TGT) started the year on a strong note. The company sustained its growth momentum in fiscal Q1 2018 (quarter ended May 5) and reported higher sales led by continued improvement in comps.
Earnings per share of 96 cents came up six cents per share short of expectations. Not included in the headline number was TXJ’s $1.13 in earnings per share, which includes a 17 cent per share gain from the Tax Cuts and Jobs Act.
Target stock has recouped those losses into May but covered little new ground, stuck in a trading range that has now entered its fifth month. Sector sentiment has improved substantially since March, with department stores posting multi-month highs while rival Costco Wholesale Corporation ( COST) flirts with a bull market high. This bullish tailwind raises the odds for a buy-the-news reaction that lifts Target stock above stubborn resistance in the upper $70s.
Walmart’s (WMT) fiscal Q1 2019 results featured several positives for investors. Walmart sustained its sales and earnings growth momentum in the first quarter and reported better-than-expected results. Plus, Walmart’s e-commerce business picked up, which is a big positive.