Latest news with #GaryMillerchip
Yahoo
3 days ago
- Business
- Yahoo
Costco Stock Has a Big Price Tag. Some Investors Are Eyeing a Rare Split
Costco's shares finished the week with a price tag over $1,000 apiece, putting them in comparatively rarified company among those of S&P 500 companies. The stock's rise has offered investors a fresh opportunity to wonder whether the company might split its stock—which hasn't happened since 2000. CFO Gary Millerchip in December said that making the shares comparatively cheap is less useful to investors now than in years past because of the availability of fractional shares. Shoppers are fans of Costco's prices. Could the warehouse giant's stock get a smaller price tag, too? That's on some investors' minds lately, with shares of Costco Wholesale (COST) among the most-expensive—on a straightforward price-per-share basis—in the S&P 500: The stock, which closed Friday at around $1,040, was one of a dozen with a four-digit share price. (Topping the list, for those who track such things, was NVR (NVR), shares of which ended the week above $7,000 apiece.) Costco's shares have gotten there in part due to a rise of roughly 25% over the past 12 months, and now there's renewed chatter about whether the company might choose to split the stock. (Stock splits do nothing to the value of a company—broadly, a 10-for-1 split means that instead of one $100 share, you have 10 $10 shares—but they're sometimes taken as a bullish signal.) 'We remain upbeat on the company's ability to gain share going forward and believe shares are positioned for continued outperformance in the current backdrop. Catalysts from here, in our view, include a potential stock split,' Oppenheimer analysts—who have a bullish rating on the shares, along with a $1,130 price target that is above the Wall Street average as tracked by Visible Alpha—wrote late Thursday after Costco reported quarterly financial results. Talk of a Costco split bubbles up from time to time partly because the company rarely does them; it hasn't happened since a two-for-one split in early 2000. Management was asked about splits at the company's January shareholder meeting, with CEO Ron Vachris saying there was 'nothing to report.' The company didn't respond to Investopedia's request for comment in time for publication. CFO Gary Millerchip on a December conference call said that making the shares comparatively cheap is less useful to investors now than in years past because of the availability of fractional shares. 'But we do also recognize that there's a benefit of the stock feeling more affordable for our retail investors and employees who are very important constituents for us," he said. "So we'll continue to evaluate over time.'Read the original article on Investopedia
Miami Herald
3 days ago
- Business
- Miami Herald
Costco defies tariff shifts with higher profit, lower prices
Costco Wholesale Corp. posted better-than-expected earnings in the third quarter, a sign that the nation's largest club chain is flexing its scale and devoted following to navigate tariffs and economic turbulence. The retailer said it generated earnings per share of $4.28 for the quarter ended May 11, above what Wall Street analysts were expecting. The metric suggests that Costco is maintaining profitability even as consumers prioritize necessities to save money. The shares rose 1.5% at 9:37 a.m. in New York trading Friday. Through Thursday's close, the stock had advanced 10% year to date, outpacing the S&P 500 Index. Costco is the latest big-box retailer to post quarterly results, as investors and analysts search for clues on how shoppers are spending. Many consumer-facing companies have posted soft results in recent weeks with Target Corp., Procter & Gamble Co. and Kraft Heinz Co. slashing their annual outlooks. Walmart Inc. and a handful of names have been outliers with strong results. Sweeping, on-again, off-again U.S. tariffs have upended operations across industries, fueling chaos among companies, investors and consumers. Courts are weighing in on whether these tariffs can stay in effect. "We are basing our decisions really based on what we know" and what's in place at the moment, Chief Financial Officer Gary Millerchip said in an interview, adding that Costco hasn't made changes in response to court orders this week as tariffs are still in effect. "It's difficult to make decisions on items that we just don't know what the outcome will be." At Costco, price increases are expected to hit later in the year as the company starts to sell new inventory. It won't be a "one-size-fits-all" scenario, Millerchip said. The retailer is likely to hold prices of some items steady and raise others. Costco may stop selling certain products if they become too expensive, and timing will also vary for items. In addition to working with suppliers, Costco is rerouting goods sourced from countries with high tariffs to other markets, Chief Executive Officer Ron Vachris said on a call with analysts Thursday. About a third of Costco's U.S. sales come from goods imported from other countries. In the U.S., it's sourcing more locally-produced mattresses, pillows and other items. The retailer also pulled forward some summer products such as sporting goods - an effort that helped Costco keep prices low. Amid tariff-driven cost increases, Costco is examining potential price changes on an item-by-item basis, executives said. For example, it held prices of pineapples and bananas - sourced from Central and South America - but raised those of other goods that are more discretionary. 'Full-force ahead' As commodity costs have dropped in recent months, Costco lowered prices of eggs, butter and other key staples. These deals, and expanding hours for gas services, helped its performance. Still, prices of non-food items rose in the low-single digits for the first time in a number of quarters due to imported goods, executives said. "It's full-force ahead on lowering prices where we can," Vachris said. Costco tends to be more resistant to economic volatilities because its customers skew more affluent and pay a fee to shop at its network of more than 800 stores. The company - known for its ever-changing assortment of mega-sized products - has been expanding its popular Kirkland brand and investing in its digital operations. Historically, it has sacrificed short-term profit margins to gain members, drive loyalty and grow business. The company's limited-assortment model and large scale also give it more flexibility on what it sells. Against the backdrop of tariffs, measures of U.S. consumer sentiment have deteriorated during most of the Trump administration on fears of an economic fallout. Spending has generally held up so far, though tariff-driven price increases are starting to hit store shelves. Many companies have signaled that they will be strategic and surgical about price increases, holding down costs of some items and discontinuing other products should they get too expensive. Overall, clothes, electronics and home goods are among the most vulnerable to levies. Costco, which reports monthly sales ahead of earnings, said its comparable sales excluding gas and currency fluctuations rose 8% during the latest quarter. E-commerce sales grew about 16% during the quarter. Traffic to website and stores also rose. Gold, toys and health and beauty items were among top sellers. Copyright (C) 2025, Tribune Content Agency, LLC. Portions copyrighted by the respective providers.
Miami Herald
22-05-2025
- Business
- Miami Herald
Walmart's Sam's Club offers membership deal Costco doesn't
When you join Costco or Sam's Club, most people consider the membership fee relatively irrelevant. If you buy regularly at either chain, you certainly get that money back in savings over time and one big-ticket purchase can more than fully pay back the cost of joining. Costco COST sells two memberships. A Gold Star membership costs $65 and gets you access to the company's warehouses, gas stations, and its website. Related: Starbucks faces huge new rival Nearly half of members, however, opt for an Executive Membership which costs twice as much ($130) but comes with 2% cash back up to $1,250 annually. At the end of the second quarter, Costco (COST) had 36.9 million paid Executive Memberships, up 9.1% versus last year. "Executive Members now represent 47.1% of paid members and 73.8% of worldwide sales," according to CFO Gary Millerchip. Sam's Club offers a similar structure. A Club Membership costs $50 per year and gets you access to the chain's website, warehouse clubs, and gas stations. Don't miss the move: Subscribe to TheStreet's free daily newsletter For $110, Sam's Club sells Plus memberships which includes includes 2% "Sam's Cash," back but only up to $500 per year. Plus members also get some other benefits. "Plus membership includes early shopping and early Curbside Pickup, so you can get in before the crowds," the chain shared on its website. It's very rare, if not impossible, to find a deal on a Costco membership. If it happens, it's almost always being subsidized by a third party. Sam's Club deals where you pay a reduced first-year fee and get a gift card to pop up from time to time. The warehouse club also offers one regular discount membership. The chain shared the details on its website. "Sam's Club wants to give back to seniors, 50 years or older by offering seniors a special membership offer. Qualified seniors who join Sam's Club online as a new member will receive a 60% discount on a Club membership or $50 off a Sam's Club Plus membership. Join as a Plus member and get free Curbside Pickup, free Delivery from Club on eligible orders of $50 or more, free shipping on eligible orders of $50 or more and early shopping at select locations," the company shared. More Retail: Costco quietly plans to offer a convenient service for customersT-Mobile pulls the plug on generous offer, angering customersKellogg sounds alarm on unexpected shift in customer behavior Most 50-year-olds likely do not consider themselves seniors. AARP, however, an association that markets to "seniors," considers 50 its entry-level age (although anyone over 18 can join). Walmart (WMT) has committed to expand and improve the Sam's Club brand. The company has also been delivering strong results for its parent company. "Sam's Club U.S. comp sales ex-fuel increased nearly 7%, with strong growth in transactions, including strength in Member's Mark. eCommerce grew 27%, led by triple-digit growth in club-fulfilled delivery and double-digit growth in pickup," Walmart CFO John David Rainey shared during hIs company's first-quarter earnings call. Rainey touted in-store and online improvements Sam's Club has made. "Member's value the convenience of Scan & Go and their usage of this tool continues to grow, with penetration increasing 600 basis points versus last year. Over 50% of our members now transact digitally in some form with Sam's, online or using digital solutions in club," he added. Sam's Club does not provide as much information on membership numbers as Costco does. Still, the numbers were strong. "In the US, Sam's Club continued to see steady growth in member counts, renewal rates and increased penetration of Plus members, resulting in membership income growth of 9.6%, " the CFO share.d Related: Costco quietly makes payment change members will love Costco had strong overall membership growth as well. "We ended Q2 with 78.4 million paid household members, up 6.8% versus last year, and 140.6 million cardholders, up 6.6% year over year," according to Millerchip. The Arena Media Brands, LLC THESTREET is a registered trademark of TheStreet, Inc.
Miami Herald
18-05-2025
- Business
- Miami Herald
Costco quietly makes payment change members will love
Costco never adapts new technology quickly. The warehouse club lets its rivals be the innovators that push boundaries. Then, once a technology has been proven out, Costco (COST) consider whether it makes sense to add it. Related: Another sporting goods chain closing all locations, no bankruptcy It's a slow and steady approach that allows the company to embrace change without having to spend money on losing ventures. By the time Costco adds something new its value has been proven out elsewhere. That's why the chain was slow to offer direct sales on its website and why it still does not use robots or other gimmicks in its warehouses. If a technology has not become mainstream, it's very unlikely that Costco will use it. Innovation comes slowly for the membership-based warehouse club, but it does happen. That includes some recent changes that benefit members. Don't miss the move: Subscribe to TheStreet's free daily newsletter "We continue to make progress with our technology road map. The new warehouse tool in our app, which allows members to view local warehouse item availability and prices had over 43 million visits," CFO Gary Millerchip shared during the chain's second quarter earnings call. Image source: VIEWpress/Getty Images While Costco takes a slow and steady approach to digital transformation, it has been working to improve the overall customer experience. "We still have a lot of work to do in this area and are excited about the potential to improve the member experience through more relevant targeted messages and experiences," he added. The chain also recently gave members a new payment option. Costco has added Affirm as a pay-over-time option for some purchases. "Split large purchases into smaller payments Choose a monthly payment option from Affirm for your online orders of $500 or more," the warehouse club shared on its website. More Retail: Costco quietly plans to offer a convenient service for customersT-Mobile pulls the plug on generous offer, angering customersKellogg sounds alarm on unexpected shift in customer behavior Affirm allows users to pick their payment terms and how much interest they end up paying. It's a simple technology that many other retailers and travel service providers have already adopted. Costco does not have to explain how Affirm works to most members because they have already seen it (and maybe used it) elsewhere. The warehouse club shared the steps to use Affirm on its website: Add $500 or more of eligible products to your cartSelect Affirm as your payment method at checkout on a few pieces of information for an real-time decision. This won't affect your a payment plan: Pay in 3-36 monthly payments. Rates are between 10-36% APR. Millerchip also spoke about two other changes Costco made that its members will like. "And Costco Next, our curated marketplace also had record holiday sales. We are now approaching 100 vendor sites and significantly grew average order value in the quarter," he shared. The chain also made a change that directly impacts its members' bottom line. "Last quarter, we increased the reward on gas purchases at Costco locations to 5%," he added. Those changes have helped Costco continue to grow its sales. "Turning now to our February sales results for the four weeks ended this past Sunday, March 2nd, compared to the same four retail calendar weeks last year. Net sales for the month of February came in at $19.81 billion, an increase of 8.8% from $18.21 billion last year," Millerchip shared. Related: Walmart CEO has a harsh warning for customers The chain excelled at pretty much every metric it shared, except for international sales. "Comparable sales for the month were as follows: U.S. comparable sales were up 8.6%, both with and without gas deflation. Canada comp sales were up 3.2% or 8.7% adjusted for gas deflation and FX. Other international comp sales were down 0.6% or up 6.5% adjusted," he added. "This resulted in total company comp sales of 6.5% or 8.3% adjusted for gas deflation and FX." The Arena Media Brands, LLC THESTREET is a registered trademark of TheStreet, Inc.
Yahoo
15-05-2025
- Business
- Yahoo
Purchase limits have tightened on Costco gold bars as popularity boomed
Gold has become such a hot commodity that Costco is apparently limiting how much its members can buy. The warehouse retailer began selling 24-karat gold bars to its members in 2023, with a limit of two bars per person. Now, that limit has changed to one per transaction and a maximum of two bars per 24 hours, when you look on the retailer website. The price tag for a 1-ounce South African-made gold bar? $3,279.99, much higher than the $2,000 they were going for 19 months ago, shortly after Costco began selling them. However, that price increase is understandable as gold prices have risen more than 70% over that time – hitting record highs in April. Noodles & Company: Could shutter up to 21 locations in 2025 Another listing, for the 1-ounce Gold Bar PAMP Suisse Lady Fortuna Veriscan, limits members to one item per transaction and a maximum of two items per 24 hours, down from a limit of five items per 24 hours in January. The same product had a cap of two purchases per membership in September 2023, according to an archived snapshot of the listing. The retailer also has limits on other precious metals including: 1-ounce American Eagle gold coin ($3,329.99; one per transaction and two per 24 hours) 10-ounce silver bar ($359.99; one per transaction and 10 per 24 hours) One option without a limit is the smaller 5-gram gold bar on an 18-karat gold chain, priced at $1,149.99. Costco did not respond to a request for comment from USA TODAY. The gold bars constantly sold out when they were first available online in 2023. "When we load them on the site, they're typically gone within a few hours, and we limit two per member,' Costco's then-chief financial officer Richard Galanti told analysts during the company's earnings call in September 2023, according to a transcript from S&P Global Market Intelligence. Sales of gold and other categories including jewelry were up double digits in the 24-week period ending Feb. 16, chief financial officer Gary Millerchip said. The retailer also began selling silver Canadian coins in March 2024. Costco could be making $100 million to $200 million a month by selling gold bars, Wells Fargo Equity Research estimated in April 2024. If gold prices remain high – prices rose more than 1% on Thursday, May 15 – and economic uncertainty continues, the bars could remain popular purchases. "You know things are getting weird when your mom starts eyeing gold bars at Costco like it's toilet paper in 2020," one social media user quipped. Contributing: Fernando Cervantes Jr., Mary Walrath-Holdridge and Anthony Robledo, USA TODAY. Mike Snider is a reporter on USA TODAY's Trending team. You can follow him on Threads, Bluesky, X and email him at mikegsnider & @ & @mikesnider & msnider@ What's everyone talking about? Sign up for our trending newsletter to get the latest news of the day This article originally appeared on USA TODAY: Costco gold bars: Retailer tightened purchase limits as prices rose
