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Morgan Stanley weighs in on Costco (COST), issuing an Overweight rating and a $90 price target...

Morgan Stanley weighs in on Costco (COST), issuing an Overweight rating and a $90 price target on shares. The firm homes in on Costco's 10% membership fee increase as a solid earnings driver. Shares are up 1% premarket after beating estimates for September same-store sales, 12% vs. 10.1%.
Comments (2)
  • HiSpeed
    , contributor
    Comments (1156) | Send Message
     
    NFLX, this is how you do it. When considering a strategy that increases costs, don't jam your customer 60% overnight! Small, incremental increases such as 10% are more likely to be accepted without being offensive and driving away customers.
    6 Oct 2011, 09:25 AM Reply Like
  • Conventional Wisdumb
    , contributor
    Comments (1802) | Send Message
     
    This will lose them some members - always a dumb idea in a tight economy.

     

    Having been a member of Costco and now BJ's, I prefer BJ's. I was loyal to Costco for many years and then one day they did a feature article on Al Gore on their member's magazine with his beatific face on the cover and I nearly puked. The propaganda piece about global warming was even worse and an insult to their readers that didn't want to swallow their bias. That was the day I decided to dump them. Their position on "card check" previously was the first nail in that particular coffin.

     

    People thought I was nuts for using this as a reason to leave but it just goes to show that a mainstream company should do everything to avoid alienating their customers.

     

    Once you open the door to a competitor it is always a dangerous move.
    6 Oct 2011, 09:33 AM Reply Like
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