Costco Wholesale Third Quarter Earnings Sneak Peek

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S&P 500 (NYSE:SPY) component Costco Wholesale Corp (NASDAQ:COST) will unveil its latest earnings on Thursday, May 24, 2012. Costco Wholesale operates membership warehouses that offer a selection of nationally branded and selected private-label products in categories such as food, appliances, and sporting goods, at low prices.

Costco Wholesale Corp Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average analyst estimate is for net income of 87 cents per share, a rise of 8.7% from the company’s actual earnings for the year-ago quarter. The average estimate is the same as three months ago. Between one and three months ago, the average estimate was unchanged. It also has not changed during the last month. Analysts are projecting profit to rise by 16.4% versus last year to $3.84.

Past Earnings Performance: The company topped forecasts last quarter after being in line with estimates the quarter prior. In the second quarter, it reported profit of 90 cents per share versus a mean estimate of 88 cents. Two quarters ago, it reported net income of 80 cents per share.

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Wall St. Revenue Expectations: Analysts predict a rise of 7.2% in revenue from the year-earlier quarter to $22.11 billion.

Analyst Ratings: With 10 analysts rate analysts rating the stock a buy, four rate rating it as a sell, and eight rate rating it a hold, analysts are bullish on the stock.

A Look Back: In the second quarter, profit rose 13.2% to $394 million (90 cents a share) from $348 million (79 cents a share) the year earlier, exceeding analyst expectations. Revenue rose 10% to $22.97 billion from $20.88 billion.

Key Stats:

With double-digit revenue growth the past four quarters, this earnings release is a chance to keep that positive trend going. The company has averaged year-over-year revenue growth of 13.8% over the last four quarters.

After experiencing income increases the last three quarters, the company is hoping to keep the good news coming with this earnings announcement. Net income rose 10.6% in the fourth quarter of the last fiscal year and 2.6% in the first quarter before increasing again in the second quarter.

Stock Price Performance: Between March 22, 2012 and May 18, 2012, the stock price had fallen $7.56 (-8.4%), from $90.50 to $82.94. The stock price saw one of its best stretches over the last year between March 6, 2012 and March 15, 2012, when shares rose for eight straight days, increasing 4.4% (+$3.88) over that span. It saw one of its worst periods between April 27, 2012 and May 9, 2012 when shares fell for nine straight days, dropping 6.8% (-$6.07) over that span.

(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)

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