Costco (COST) Reports Q1: Everything You Need To Know Ahead Of Earnings

Jabin Bastian /
2023/12/13 2:00 am EST

Membership-only discount retailer Costco (NASDAQ:COST) will be reporting results tomorrow after the bell. Here's what investors should know.

Last quarter Costco reported revenues of $78.94 billion, up 9.5% year on year, beating analyst revenue expectations by 1.3%. It was a very strong quarter for the company, with an impressive beat of analysts' revenue expectations, although same-store sales same-store sales excluding the impact of fuel sales and FX missed slightly. EPS also beat.

Is Costco buy or sell heading into the earnings? Read our full analysis here, it's free.

This quarter analysts are expecting Costco's revenue to grow 6.1% year on year to $57.75 billion, slowing down from the 8.1% year-over-year increase in revenue the company had recorded in the same quarter last year. Adjusted earnings are expected to come in at $3.43 per share.

Costco Total Revenue

The analysts covering the company have had mixed opinions about the business heading into the earnings, with revenue estimates seeing six upward and five downward revisions over the last thirty days. The company missed Wall St's revenue estimates three times over the last two years.

Looking at Costco's peers in the non-discretionary retail segment, some of them have already reported Q3 earnings results, giving us a hint of what we can expect. Dollar Tree delivered top-line growth of 5.4% year on year, missing analyst estimates by 1.4% and Walmart reported revenues up 5.2% year on year, exceeding estimates by 1.4%. Dollar Tree traded down 2.9% on the results, and Walmart was down 5.9%.

There has been positive sentiment among investors in the segment, with the stocks up on average 10.1% over the last month. Costco is up 6.6% during the same time, and is heading into the earnings with with analyst price target of $610.1, compared to share price of $630.

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The author has no position in any of the stocks mentioned.