Costco earnings after the bell: key measure of consumer spending power

Costco Wholesale  (COST) - Get Free Report shares edged lower ahead of the warehouse-club retailer's fiscal-fourth-quarter earnings report, slated for after the closing bell.

The report is likely to provide a good indication of consumers' spending power heading into the calendar fourth quarter.

For the three months ended in June, analysts expect Costco to post a bottom line of $4.79 a share, a 14% increase from the year-earlier period, with revenue rising just over 8% to $77.9 billion. 

The summertime surge in gas prices, which lifted the average cost of a gallon to around $3.96 last month, according to Energy Department data, is likely to boost foot traffic at Costco as members take advantage of the chain's discounted gas prices. 

The group's August sales update showed revenue rose 5% from a year earlier to around $18.42 billion. But Costco also noted weakened comparable-sales figures indicated softness in the group's online offering, where sales fell 2.5%.

Costco said in late May that weaker spending on big-ticket items held back same-store sales for the three months ended May 7, as overall revenue rose 1.9% from  a year earlier to $52.6 billion, missing Wall Street forecasts.

"We're not only comparing against this 'recession' or concerns about big-ticket items but comparing against uber strength over the last two years prior to that," Chief Financial Officer Richard Galanti told investors on May 25. "So I think we'll come out of this fine. We're pretty good at figuring out new items and new things to do."

Costco shares were marked 0.1% lower at last check to indicate an opening bell price of $558.15 each, a move that would trim the stock's six-month gain to around 13.4%.

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