Costco Wholesale Corporation (COST) posted its comparable-store sales (comps) results for the five weeks ended Jan 4, 2015 that fared better than analysts' expectations. On Jan 8, the warehouse retailer announced comps growth of 3%, reflecting an increase of 5% at its U.S. locations but a decline of 1% at international locations.
Excluding the effect of deflation in gasoline prices and the impact of foreign currency fluctuations, Costco’s comps for Dec 2014 rose 8%, reflecting an equivalent increase across its U.S. locations and international outlets.
Retailers benefited during the month under review from increasing consumer confidence and improving job prospects. Retailers such as Rite Aid Corp. (RAD) and L Brands, Inc. (LB) saw their comps rise 5.3% and 4%, respectively, during the month.
Coming to Costco, comps for the 18-week period increased 4%, buoyed by a 6% rise at its U.S. locations. Comps at international locations remained flat. Excluding the effect of gasoline prices and foreign currency fluctuations, comps for the period jumped 7%, reflecting an equivalent increase across its U.S. and international locations.
Costco’s total net sales for December grew 5% to $12.12 billion from $11.53 billion in the year-ago period. Net sales for the 18-week period increased 7% to $40.85 billion from $38.33 billion in the prior-year period.
The company operates 671 warehouses, 474 in the U.S. and Puerto Rico, 88 in Canada, 34 in Mexico, 26 in the United Kingdom, 20 in Japan, 11 in Korea, 10 in Taiwan, 7 in Australia and 1 in Spain.
Costco currently carries a Zacks Rank #3 (Hold). A better-ranked stock in the retail sector is Burlington Stores, Inc. (BURL), which has a Zacks Rank #1 (Strong Buy).
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