Here's some good news for what some call the "anti Wal-Mart".
Costco Wholesale's (COST)'s share price surged Oct. 12 after the warehouse operator reported stronger quarterly earnings, with help from factors such as improved sales and margins.
As we all know, "improved sales" is a winner.
I'm sure it was all smiles in Issaquah.
Costco said its net income for the 17-week fourth quarter ended Sept. 3 was $355.6 million, or 75 cents per diluted share, compared to $354.7 million, or 73 cents per diluted share, during the 16-week fourth quarter of fiscal 2005.
It's interesting that their net income was within a whisker of what they did last year during that time frame, in spite of record energy costs.
"We expect pressure on comp-store sales because of increased cannibalization [newly opened stores taking sales away from locations in adjacent communities] and lower retail gas prices. However, we believe results will benefit from wider gas margins, increased interest income and continued share repurchases," Standard & Poor's Corp. equity analyst Joseph Agnese said in a research note.
I'm a little curious about the "share repurchases" comment. Protecting themselves from an over ambitious competitor?
Costco's chief financial officer, Richard Galanti, noted in a press release that several factors boosted his company's results, including income tax benefits, stronger than planned operating results, improved gasoline profitability, and lower than expected costs related to workers' compensation.
So all seems to be well in the land of Costco. Wonder what that means for 2007?
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