Costco's miss is management's fault

Filed under: Earnings reports, Bad news, Wal-Mart (WMT), Newsletters, Costco Wholesale (COST), Stocks to Sell

Not all retailers are created equal.

Some are better than others and that has become abundantly clear during this economic recession. While the entire sector has been struggling, there are pockets of strength.

That strength comes from the discounters. Led by discount king, Wal-Mart (NYSE: WMT), consumers have been flocking to these stores looking for a bargain. Nothing motivates more than a deal on a cash-starved budget.

Wal-Mart and others have been cleaning up in this environment. Yes, the operating environment is challenging no matter what your prices, but those with the lowest prices are faring much better than those with higher ones.

That is why yesterday's news from Costco (NASDAQ: COST) was so disturbing.

The company announced its first-quarter earnings, and the results were less than stellar.

COST stated that in the period that ended Nov. 23, profits were only up fractionally as compared to the same period last year, even though revenue was up 4%. The company generated a profit of 60 cents per share that missed analyst expectations by 2 cents.

Although it's not a big miss in the scheme of things, I'm disappointed with the results.

Continue reading Costco's miss is management's fault

Costco's miss is management's fault originally appeared on BloggingStocks on Fri, 12 Dec 2008 11:22:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments