Shares of Costco Wholesale Corporation (COST) rose marginally by 0.1% following comparable-store sales results for June, the five weeks ended Jul 6, 2014, that bettered analysts' expectations. The warehouse retailer delivered comparable-store sales growth of 6%, reflecting an increase of 6% in the U.S. and 7% at international locations.
Excluding the effect of inflation in gasoline prices and impact of foreign currency fluctuations, Costco’s comparable-store sales for June rose 6%, reflecting comparable sales growth of 6% at its U.S. locations and 8% at international outlets.
Most of the retailers benefited during the month under review, as favorable weather conditions, aggressive promotional strategies and improving job prospects were enough to lure consumers. Retailers such as Rite Aid Corp. (RAD), Zumiez Inc. (ZUMZ) and Walgreen Co. (WAG) saw their comparable-store sales increasing 3.9%, 3.1% and 7.5%, respectively, during June.
Coming to Costco, comparable-store sales for the 44-week period, increased 4%, buoyed by 5% growth at the U.S. and 2% increase at international locations. Excluding the effect of gasoline prices and foreign currency fluctuations, Costco’s comparable-store sales for the period jumped 6%. Comps increased 5% at the U.S. and 7% at international locations.
Total net sales for June grew 10% to $10.89 billion from $9.91 billion in the year-ago period. Costco’s net sales for the 44-week period increased 7% to $92.88 billion from $87.04 billion in the year-ago period.
The company currently operates 658 warehouses, 465 in the United States and Puerto Rico, 87 in Canada, 33 in Mexico, 25 in the United Kingdom, 20 in Japan, 11 in Korea, 10 in Taiwan, 6 in Australia and 1 in Spain. Further, the company plans to open 5 more warehouses before the end of fiscal 2014.
Currently, Costco carries a Zacks Rank #3 (Hold).
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