Costco (Nasdaq: COST) has been a paragon of consistency in the retail industry throughout its history, and it’s established a wide economic moat thanks to its business model and track record of customer satisfaction.
Costco will put that reputation on the line when it reports third-quarter earnings on Thursday after-hours
Analysts are expecting revenue at the retail giant to grow 10.2% to $69.6 billion and for generally accepted accounting principles (GAAP) earnings per share to improve from $4.28 to $4.92. Is Costco a buy ahead of earnings? Let’s take a closer look at what to expect.
The consumer is under pressure Costco’s report comes the week after we heard from two of its closest competitors. Walmart and Target both reported earnings last week, and while they delivered solid results, they expressed cautiousness about the remainder of the year, noting that the consumer is facing pressure from inflation, including high gas prices, and a weak labor market. Both companies also noted the benefit from increased tax refunds in the quarter, which could help Costco as well.