logo
  Join        Login             Stock Quote

Comparing Costco & BJ's Results

 March 04, 2009 12:04 PM
 



This morning, two membership warehouses reported 4th quarter results. Costco (COST) missed Zacks consensus EPS estimates by $0.05, while revenues were in line. BJ's Wholesale Club (BJ) reported earnings of $0.89 per share $0.03 above the Zacks consensus estimate, while falling a little short on revenue.

Both companies were negatively affected by gasoline deflation. As gasoline prices fall, BJ's and Costco's overall gasoline sales fall. Costco, which generates about 20% of its sales outside the US, was also hurt by the stronger US dollar.

Those trends were largely offset by an increasing number of consumers looking to get the most value for the dollar. This is evident in the 3.7% rise in Costco's membership fees and a 7% increase in BJ's store traffic (excluding gasoline sales).

Both companies are attracting shoppers because of their prices are so low. The companies' razor-thin gross margins shows this to be the case. In the 4th quarter, Costco had an overall merchandise margin of 12.3%, down from 12.5% in the year-ago quarter.

BJ's gross margin is lower than Costco's, but it moved higher in the 4th quarter. BJ's gross margin was 11.3%, up 20 basis points from the year-ago quarter. In the current economic environment, more shoppers will be walking the aisles of a Costco or BJ's Wholesale Club.

Looking ahead, BJ's expects to earn $2.26-$2.36 per share compared to the Zacks consensus of $2.26 consensus. Consistent with its Feb 4 pre-announcement, Costco did not provide full-year guidance.
iOnTheMarket Premium
Advertisement

Advertisement


Comments Closed


rss feed

Latest Stories

article imageDelta Air Lines (DAL): Panic Selling Makes This Airline Stock Ripe For A Quick Pop

If there ever were a teaching moment in the stock market, it was this week. Earnings, trendlines and read on...

article imageInvesting In The Time Of Ebola

Volatility is back in the market. Whether we are being tossed and turned by the Ebola crisis, Russian read on...

article imageMarket Volatility Continues But Is Bottom In?

The market’s volatility continues, and it has the outlook and expectations of the financial media jumping read on...

article imageBrazil's Petrobras Attracts Bullish Options Play

Brazilian stocks advanced with ADR shares in state-owned oil company Petroleo Brasileiro SA (Ticker: PBR) read on...

Advertisement
Popular Articles

Advertisement
Daily Sector Scan
Partner Center



Fundamental data is provided by Zacks Investment Research, and Commentary, news and Press Releases provided by YellowBrix and Quotemedia.
All information provided "as is" for informational purposes only, not intended for trading purposes or advice. iStockAnalyst.com is not an investment adviser and does not provide, endorse or review any information or data contained herein.
The blog articles are opinions by respective blogger. By using this site you are agreeing to terms and conditions posted on respective bloggers' website.
The postings/comments on the site may or may not be from reliable sources. Neither iStockAnalyst nor any of its independent providers is liable for any informational errors, incompleteness, or delays, or for any actions taken in reliance on information contained herein. You are solely responsible for the investment decisions made by you and the consequences resulting therefrom. By accessing the iStockAnalyst.com site, you agree not to redistribute the information found therein.
The sector scan is based on 15-30 minutes delayed data. The Pattern scan is based on EOD data.