NEW YORK (TheStreet) -- Costco Wholesale (COST) shares are down 1.26% to $139.63 in early market trading on Friday after the big box retailer's rating was cut to "neutral" from "buy" by analysts at Janney before the opening bell today.
The company reported a 17% increase in profit in the quarter ending in November, and said that the boost was driven by lower gasoline prices along with same store sales growth and strong income from membership fees.
However, analysts at the firm believe that the windfall the company received from lower gasoline prices will be reversed in the coming months as the price of oil fluctuates. The firm also noted that a stronger dollar will hurt the company's bottom line.
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TheStreet Ratings team rates COSTCO WHOLESALE CORP as a Buy with a ratings score of A. TheStreet Ratings Team has this to say about their recommendation:
"We rate COSTCO WHOLESALE CORP (COST) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its revenue growth, growth in earnings per share, increase in net income, largely solid financial position with reasonable debt levels by most measures and solid stock price performance. We feel these strengths outweigh the fact that the company shows low profit margins."