Is Costco's Dominance in Danger?
For decades, Costco Wholesale (NASDAQ: COST) has dominated the warehouse retail space. With millions of loyal members flocking to its stores and using its budding online e-commerce site, Costco has adapted to changing conditions in the retail industry while still being true to the core philosophy its customers embrace every day.
Yet some have wondered whether Costco is truly invulnerable to shifting consumer trends more broadly. Costco's fiscal fourth-quarter report showed the same level of solid, consistent growth that investors have come to rely on, but it also revealed some trouble spots that could prove problematic if they continue in the long run.
Costco's fiscal fourth-quarter report looked a lot like what investors have seen over the past several periods. Revenue of $47.50 billion was up 7% from year-ago levels, slowing only slightly from its pace three months ago. Net income growth was considerably slower, but net income still rose 5% to $1.10 billion. After accounting for a pre-tax charge, adjusted earnings of $2.69 per share compared favorably to the consensus forecast among investors for $2.54 per share.
Source Fool.com
