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The membership warehouse company is scheduled to report its third-quarter earnings on May 24. Analysts, on average, anticipate earnings of 87 cents a share on revenue of $22.13 billion.
"Following COST's monthly sales data for the majority of Q3 and NRSE's retail sales data for the first week of May, we are raising our Q3 comp estimate to +5% (from +4%) and our EPS to $0.87 (from $0.85)," Piper Jaffray analysts wrote in a May 14 report. "We believe COST earnings will be supported by increase in the membership fee income as well as the approach of an inflection point in gross margin in the November quarter. In addition, the recent pullback leaves COST very attractive from a valuation standpoint, in our view. COST is currently trading at 17.6x FY13E EPS, net cash of $7.98/share, and below its 19.7x average over the last ten years. We recommend buying shares on the recent pullback and ahead of the quarter."
Forward Annual Dividend Yield: 1.2%