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Costco Wholesale Corporation operates membership warehouses that offer a selection of branded and private label products in a range of merchandise categories in no-frills, self-service warehouse facilities.

Costco Wholesale Corporation (NASDAQ:COST) is scheduled to report its third quarter earnings results on May 24, 2012, before the market open.

Overview

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Costco has a market cap of $36.71 billion and it is currently trading at around $84.30 with a 52 week range of $69.82 to $92.10. The stock is up 1.18% YTD. The following table provides the key financial ratios for Costco:

Key Ratio

Value

Current Ratio

1.16

PEG

1.85

P/E

24.66

Forward P/E

19.4

Profit Margin

1.69%

Return On Assets (ROA)

5.94%

Return On Equity (ROE)

12.73%

Recent News

  • On May 09, 2012, Costco announced that its Board of Directors declared a quarterly cash dividend on Costco common stock and approved an increase from $.24 to $.275 per share, or from $.96 to $1.10 per share on an annualized basis. The quarterly dividend is payable June 8, 2012, to shareholders of record at the close of business on May 25, 2012.
  • On May 04, 2012 Market Edge downgraded Costco from BUY to HOLD.
  • On May 03, 2012, Costco reported net sales of $7.25 billion for the month of April, the four weeks ended April 29, 2012, an increase of seven percent from $6.80 billion during the similar period last year.
  • On May 1, 2012 Deutsche Bank downgraded Costco from BUY to HOLD.
  • On April 25, 2012, Southern Products (OTC:SNPD), a manufacturer of "Assembled in the USA" flat-panel televisions received a recent order for 2,340 flat screen televisions from Costco.com along with a request for bid on an additional 10,000 more to be sold immediately.
  • On April 05, 2012, Costco reported net sales of $9.13 billion for the month of March, the five weeks ended April 1, 2012, an increase of 10 percent from $8.33 billion during the similar period last year.
  • On March 5, 2012, Costco was raised to outperform from market perform by William Blair.

Analyst Guidance and Earnings History

Q3 revenues are expected to be $22.16 billion vs. $20.62 billion for the same quarter a year ago. Earnings per share for the third quarter are expected to be 87 cents a share, up from 73 cents a share in the year-ago period.

The average analyst price target for Costco is $87.13 with an average rating of OVERWEIGHT.

Out of the last 4 quarters, Costco has met or exceeded EPS estimates twice. The following chart shows recent historical analyst estimates vs. actual EPS results:

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Sources: Data is taken from Google Finance, Yahoo Finance, Finviz, Fidelity and investor sites.

Disclaimer: I am not a registered investment advisor and do not provide specific investment advice. The information contained herein is for informational purposes only. Nothing in this article should be taken as a solicitation to purchase or sell securities. Before buying or selling any stock you should do your own research and reach your own conclusion. It is up to investors to make the correct decision after necessary research.

Disclosure: I have no positions in any stocks mentioned, but may initiate a long position in COST over the next 72 hours.

Source: Earnings Preview: Costco

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