Costco Wholesale Corporation (Nasdaq: COST) posted mixed fiscal second quarter earnings results, as profit came well short of expectations but revenue beat estimates.

Written by StockNews.com

The Issaquah, WA-based membership warehouse operator reported Q2 EPS of $1.17, which was $0.18 worse than the Wall Street consensus estimate of $1.35.

Revenues rose 5.7% from last year to $29.77 billion, topping analysts’ view for $29.75 billion.

The company noted that comparable sales (“comps”) in the latest period rose 3%. Comps are considered a key indicator of a retailer’s health, since they only take into account year-over-year sales at established locations open at least 12 months. COST also said that February comps gained 4% from the year ago period, or +2% when excluding fuel and foreign exchange effects.

Costco commented on its impending membership fee increases via press release:

The Company [announced] that, effective June 1, 2017, it will increase annual membership fees by $5 for U.S. and Canada Goldstar (individual), Business, and Business add-on members (“Primary” Members). With this increase, all U.S. and Canada Goldstar, Business and Business add-on members will pay an annual fee of $60. Also effective June 1, annual fees for Executive Memberships in the U.S. and Canada will increase from $110 to $120 (Primary membership of $60, plus the Executive upgrade of $60), and the maximum annual 2% reward associated with the Executive Membership will increase from $750 to $1,000. The fee increases will impact around 35 million members, roughly half of them Executive Members.

Costco Wholesale Corporation shares were trading at $177.98 per share on Thursday afternoon, up $0.12 (+0.07%). Year-to-date, COST has gained 11.46%, versus a 6.59% rise in the benchmark S&P 500 index during the same period.

COST currently has a StockNews.com POWR Rating of A (Strong Buy), and is ranked #2 of 21 stocks in the Grocery/Big Box Retailers category.