Continue reading Kroger Fourth Quarter Earnings Preview

Kroger Fourth Quarter Earnings Preview originally appeared on BloggingStocks on Mon, 08 Mar 2010 18:00:00 EST. Please see our terms for use of feeds.

Continue reading BJ's Wholesale Club (BJ) September sales dip

BJ's Wholesale Club (BJ) September sales dip originally appeared on BloggingStocks on Thu, 08 Oct 2009 13:20:00 EST. Please see our terms for use of feeds.

"BJ's recognizes the diverse financial status and changing needs of its members," commented president and CEO Laura Sen in a statement. "We are proud to help members stretch their food budgets by offering savings on a large selection of fresh fruits, vegetables, meats and baked goods, along with name-brand, non-perishable staples."

Continue reading Sign of the times: BJ's Wholesale Club now accepting food stamps

Sign of the times: BJ's Wholesale Club now accepting food stamps originally appeared on BloggingStocks on Tue, 14 Apr 2009 15:00:00 EST. Please see our terms for use of feeds.

Costco (NASDAQ: COST), a warehouse club that competes with BJ's Wholesale Club (NYSE: BJ) and Wal-Mart (NYSE: WMT), reported earnings for the second quarter on Wednesday. The company experienced a significant drop in the bottom line. Costco earned 54 cents per share on a diluted basis. That represented a decline of 26%. Analysts thought that 59 cents per share was doable. It wasn't. Net sales dropped 1%. Excluding gasoline and currency effects, same-store sales went up by 5% overall during the quarter (including those items, comps declined 3%).

Well, now, what does this tell us about Costco? It tells us that the whole thesis that people will be looking to save money by shopping at warehouse clubs doesn't necessarily translate into a successful earnings picture. Hey, what can you do? We're in a grand recession. And it's getting worse. Of course, it should be noted that Costco management must strive to work even harder to get people to spend more money in their stores. In fact, BJ's did pretty well with its numbers: Costco's competitor beat the analysts, even after adjustments.

Continue reading Costco misses estimates, near 52-week low -- buy or avoid?

Costco misses estimates, near 52-week low -- buy or avoid? originally appeared on BloggingStocks on Thu, 05 Mar 2009 08:30:00 EST. Please see our terms for use of feeds.

Costco Wholesale Corporation (NASDAQ: COST) didn't have the greatest first quarter on record. On a reported basis, earnings per share on a diluted basis rose a penny to $0.60. A single, sad, solitary penny. But, let's go non-GAAP, shall we? If we add back $0.05 relating to the mark-to-market effect of some life insurance contracts, we get $0.65 per share, which, according to this article, means that Costco beat earnings estimates by $0.03.

That's not bad, actually, although the market wasn't impressed. As I write this, the stock is down over 2.5%. While the top line increased 3.7% to $16.4 billion, same-store sales expanded by a smaller amount. And, as we all know, same-store sales are the big thing when it comes to gauging the relative health of a retail operation with multiple store locations (although many pundits do argue that you shouldn't go overboard in terms of focusing on comps). Costco saw its comps rise by a mere 1%. And, interestingly enough, I noticed in the press release that the effect of a stronger dollar made itself known to the company during the quarter. There's been a lot of talk lately about how the fluctuating currency markets would eventually impact businesses with foreign exposure. Considering that we're a global economy, every individual investor must keep this in mind.

So, Costco, which competes with BJ's Wholesale Club (NYSE: BJ) and Wal-Mart Stores, Inc. (NYSE: WMT), did okay for the quarter in terms of earnings, but comps are a different matter. Management said that non-food categories were weak. Not surprising, considering that foodstuffs are, in theory, the defensive business in a bad spending environment. Costco will have to address that through better merchandising. As for the stock, I agree with Elizabeth Harrow that it could be cheap. If you've got a very long-term horizon, you should be okay with this company, but traders would be advised to use a tight stop on it. I could see this one going down from here, at least in the short-term, based on the weak comps.

Disclosure: I don't own any company mentioned; positions can change at any time.

Costco's Q1 earnings didn't thrill the market originally appeared on BloggingStocks on Thu, 11 Dec 2008 15:39:00 EST. Please see our terms for use of feeds.

BJ's Wholesale Club (BJ) drops despite strong earnings originally appeared on BloggingStocks on Wed, 20 Aug 2008 13:08:00 EST. Please see our terms for use of feeds.

Continue reading Discount merchants benefit from high sales in June

Discount merchants benefit from high sales in June originally appeared on BloggingStocks on Fri, 11 Jul 2008 15:50:00 EST. Please see our terms for use of feeds.

The Wall Street Journal reports that BJ's Wholesale Club (NYSE: BJ) reported a 26% rise in net income. Its earnings of 29 cents a share beat analysts' expectations by a penny. And as consumers go on their crash recession diet, BJ's is likely to continue to exceed expectations. I would not be surprised if its stock keeps rising.

That's because results are growing faster than had been expected. The Journal reports that BJ's revenue climbed 12% to $2.31 billion. Earlier this month, BJ's said net sales increased 12% to $2.26 billion, as same-store sales rose 9.6%, with gasoline sales contributing 3.9 percentage points to the rise. And BJ's raised its EPS guidance by six cents to $2.04 to $2.14 a share. The mean estimate was $2.06 a share.

BJ's joins two beneficiaries of consumers' recession diet -- Wal-Mart Stores (NYSE: WMT) and TJX Co's (NYSE: TJX) -- caused by the rising price of gasoline coupled with flat income and collapsed housing values. After all, if you can't borrow against your house and your credit cards are maxed out, where are you going to turn to keep your family functioning?

Peter Cohan is President of Peter S. Cohan & Associates. He also teaches management at Babson College and edits The Cohan Letter. He has no financial interest in the securities mentioned.

BJ's profits from consumers' recession diet originally appeared on BloggingStocks on Wed, 21 May 2008 09:40:00 EST. Please see our terms for use of feeds.