Crowder Securities Limited - Costco shares hit a record peak after earnings—here's why

Costco (COST) shares rose more than 4% to a new high in early trading Friday after the company reported fiscal first-quarter earnings that above analysts' forecasts, as shoppers flocked to Costco's food and other items in quest of cheaper pricing.
WAN CHAI, Hong Kong - Dec. 18, 2023 - PRLog -- The membership-only retailer posted net revenues of $56.72 billion, up 6.1% year on year and above analyst expectations. Net income of $2.2 billion, or $4.86 per share, up from $1.87 billion, or $4.20 per share, the previous year, and above forecasts.

The improvements occurred as memberships increased and sales of commodities such as food increased, with Costco estimating that it sold over 4 million pies during the Thanksgiving weekend alone. Year over year, the number of paying household members increased 7.6%, while membership fee income increased 8.2% to $1.08 billion.

Costco Chief Financial Officer Richard Galanti said that the business outperformed expectations on Black Friday and Cyber Monday. He also mentioned the popularity of its gold bars, stating that Costco sent $100 million in gold during the quarter.

Costco CEO Craig Jelinek will step down at the end of the year, according to Galanti, after a decade in leadership. He will be succeeded by Ron Vachris, who began his career as a forklift operator and is now the company's chief operating officer.

Costco also declared a special cash dividend of $15 per share, which will be paid on January 12.

Costco shares were up 4.8% as of 12:20 p.m. ET Friday and had risen more than 45% year to date.

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