Following a relatively unimpressive earnings report in December, shares of Costco Wholesale Corporation (NASDAQ:COST) dropped precipitously, providing investors with a unique investing opportunity in one of the best retailers available to investors today.
Since the late-2018 drop, however, shares have rebounded, supported by investor appetite for growth in the safety of the retail sector. Costco has continued to be one of the best operators in a field filled with companies that are struggling to compete with online offerings from companies willing to deliver and take much of the unpleasantness of grocery shopping out of the picture.
Much ado was made about the 50 basis point drop in Costco earnings reported on the company's most recent filing, with worries that competitiveness and rising costs may continue to eat away at margins in the future offsetting what was otherwise a very positive report.
Of the 0.5% margin dip, almost half was due to the company's gasoline operations, which have traditionally hurt overall margins, and the company reported revenue which beat estimates, coming in at $35 billion this most recent quarter.
Additionally, same store sales rose 7.5% year over year, handily beating analyst estimates of 5.8%, reflecting the value provided by the company's near term investments in improving its product offerings.
For long-term investors seeking value and growth in a relatively safe sector, I would encourage deeper investigation into Costco as a great buy-and-hold stock.
Invest wisely, my friends.
