BJ's Wholesale Club (BJ) reported better-than-expected fourth-quarter earnings, a day ahead of larger rival Costco Wholesale (COST). Ahead of Wednesday's stock market open, BJ's Wholesale stock soared.
XBJ's Wholesale Club Earnings
Estimates: BJ's Wholesale earnings per share was seen coming in at 36 cents, with revenue falling to $3.389 billion.
Results: BJ's Wholesale earnings rose to 44 cents a share. Revenue fell 3.9% to $3.42 billion. Comparable club sales rose 2.8%, with merchandise comps up 2.9%.
Outlook: BJ's sees full-year EPS of $1.42-$1.50 on revenue of $12.9 billion to to $13.2 billion. Analysts had forecast 2019 BJ's Wholesale earnings of $1.47 a share with sales of $13.335 billion.
BJ's Wholesale Stock
Shares rose 3.3% to 27.51 in early stock market trading Wednesday. BJ's Wholesale stock appears set to clear a handle. But the midpoint of the handle is just below the midpoint of the base. That makes it invalid. There's still too much potential overhead resistance. BJ's stock is set to break higher, but not break out.
Also, BJ's Wholesale stock is in a deep base. Deep consolidations are less likely to work, though BJ's current pattern formed during the stock market correction soon after coming public in June.
BJ's Wholesale IPO priced at 17, but jumped 80% in its June 28 trading debut. Shares cleared a flat IPO base in late August and rocketed to a record high of 32.92 on Sept. 7. Shares then plunged to 19.31 on Nov. 20. Since then, shares have rebounded, with the relative strength line moving higher over that time.
BJ's Wholesale Club is primarily based on the East Coast, with about 215 locations across 16 states. BJ's says it has 5 million paying members. Larger rival Costco Wholesale (COST) has 93 million. BJ's stores also tended to be smaller than Costco's huge warehouses.
Costco earnings are due Thursday.
BJ's and Costco also compete with the Sam's Club unit of Walmart (WMT), which reported solid same-store sales growth for the latest quarter.
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The post BJ's Wholesale Earnings Top; Costco Rival Jumps appeared first on Investor's Business Daily.
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