Issaquah, WA, October 1-- Costco's fourth-quarter sales rang up below Wall Street's expectations, but analysts aren't too concerned about a major hit to earnings.
For the quarter, analysts expecting earnings of 58 cents a share, on average, for a 14 percent increase over last year's results.
Costco said last month that total sales for the quarter rolled in 11 percent over the same period last year at $14.84 billion, below the First Call expectation of $15.22 billion.
August sales came in a weaker-than-expected 4 percent higher while total sales rose 7 percent to $3.42 billion.
In resuming his coverage of Costco, Piper Jaffray analyst Mitchell Kaiser slapped an "outperform" rating on the stock with a $51 price target.
"Costco continues to move forward with its highly successful big-box strategy," he said in a note to clients. "While the pressure on the lower-end consumer has impacted sales and earnings of other retailers, Costco's focus on the higher-end consumer has to some extent insulated it from these trends.
"That, combined with management's renewed interest in benefits to shareholders, leads us to believe better days are ahead for margins and earnings," he said.
