Costco plans 93 new warehouses in three years

Costco is a strong player in the retail market with a loyal customer base. Known for its quality products and low prices, the company benefits greatly from a membership model, which contributes significantly to its profits. Recently, Costco has been able to grow its store base while also tapping into e-commerce for expansion. In its latest financial results, Costco reported a 9.1% increase in comparable sales, excluding fuel prices and currency effects, showing that demand remains strong. E-commerce sales grew even more, rising by 22.2%. These trends indicate that Costco is in a good position to continue expanding its number of warehouses. Currently, Costco operates 897 warehouses and plans to add about 93 more in the next three years. This would bring the total up to 990 locations. If comparable sales grow between 5% and 10% annually, Costco’s total sales could rise between 26% and 43% over that period. Membership fees are another key part of Costco’s revenue. The company recently increased its basic membership fee to $65, which should boost membership income significantly. Paid memberships have been on the rise, increasing by 7% each year. If this trend continues, Costco could add about 23% more members in three years. Overall, Costco's operating income is expected to grow, which would lead to a rise in earnings per share as well. While the stock is currently valued high, Costco's stable business model may keep investors interested. However, potential shareholders should be cautious about high expectations in the short term. The company is well-prepared for steady growth, even amid economic challenges.