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From its $4.99 rotisserie chickens to its $1.50 hot dog combos, Costco has long been a favorite of budget-conscious shoppers.
Amid rising food prices, inflation-stricken consumers are trying to stretch their money further, to Costco’s benefit. The wholesaler closed its fiscal second quarter of 2023 with 123 million cardholders, up about 7% from a year ago, Richard Galanti, Costco’s chief financial officer, said on its March 2 earnings call.
The retailer reported revenue of $55.27 billion for its fiscal second quarter of 2023, beating the analyst forecast of $55.54 billion, according to Refinitiv consensus estimates. However, the company reported earnings per share (EPS) of $3.30, which was higher than the $3.21 analysts had expected.
While the retailer has no plans to increase its annual membership fee for now, customers may need to prepare to pay a bit more for membership in the future. When asked about a possible fee increase, Galanti said, “It’s a matter of when, not if.”
It’s been nearly six years since Costco raised its membership fees. In June 2017, Costco increased the price of its Standard Gold Star membership from $55 to $60, and increased the price of its Executive membership from $110 to $120.
According to the National Retail Federation’s “Top 100 Retailers 2022 List”, Costco is the third largest retailer in the US by revenue as of 2022.
Costco released its fiscal second quarter results after the bell on March 2. The next day, shares fell slightly 2.15%, ending session trading at $475.26 per share.
Here’s how much money you’d have on March 3 if you invested $1,000 in the company one, five, and 10 years ago.
Here’s how much money you’d have on March 3, 2023 if you invested $1,000 in Costco one, five, and 10 years ago.
If you invested $1,000 in Costco a year ago, your investment would be worth about $898 on March 3, according to CNBC’s calculations.
If you had invested $1,000 in Costco five years ago, your investment would have more than doubled to $2,639 by March 3, according to CNBC’s calculations.
And if you put $1,000 into Costco a decade ago, it would have risen to $5,124 on March 3, according to CNBC’s calculations.
If you’re interested in investing in Costco, Walmart, or any other company, remember: the stock market is unpredictable, and you shouldn’t use a stock’s past performance to predict how well it will perform in the future.
A passive investment strategy usually makes sense for most investors, rather than selecting individual stocks. Experts typically recommend investing in low-cost index funds, which give your portfolio exposure to a wide variety of companies.
For example, investing in the S&P 500 might be a good place to start. It’s a market index that tracks the stock performance of 500 major US companies, which can bring diversity to your portfolio.
On March 3, the S&P 500 was slightly down just over 7% compared to 12 months ago, according to CNBC’s calculations. However, the index is up about 50% since 2018 and has grown about 166% since 2013.
Get CNBCs for free Warren Buffett guide to investingwhich summarizes the billionaire’s best advice for regular investors, the do’s and don’ts and three key investing principles in a clear and simple guide.
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