3/5/2023 0 Comments Costco corona priceThe important beer segment supply chain is uncertain, the cannabis-products segment is still a question mark, and certain divestitures in other business segments haven't yet happened. Earnings-growth expectations for the next three to five years stand at 11.8%.ĭue to uncertainties caused by the health crisis, neither company is issuing forward guidance, but Costco's trajectory seems more stable.Ĭonstellation Brands is a good company, but at the moment, there's too much uncertainty to choose Constellation over Costco as an investment. The company reported second-quarter 2020 earnings of $2.10 per share on March 5, beating Wall Street expectations of $2.06. Earnings-growth expectations for the next three to five years stand at 18.5%.Ĭostco's share price is up 1.8% year to date and up 22.3% year over year. The company reported fourth-quarter 2020 earnings of $2.06 per share on April 3, beating Wall Street expectations of $1.65. Better investmentīoth Constellation Brands and Costco are surviving COVID-19, but one is a better investment than the other.Ĭonstellation Brands' share price is down 16% year to date and down 22.7% year over year. The company has almost 101 million members, with a renewal rate of 91%. The great deals on merchandise are what attract new members and keep the all-important renewal rate up. The acquisition boosts the company's online capabilities at just the right time, when home improvement is up but consumers don't want to leave home to shop.Ĭostco's membership model, which offers members heavily discounted quality merchandise, is working. In March, Costco acquired last-mile company Innovel Solutions, which delivers and sets up big and bulky items like appliances. Additionally, the gasoline segment suffered due to reduced volume and price deflation. The gain is impressive given the limited services or closures of entire departments due to coronavirus, including food courts, travel, optical, hearing aids, and photo. As a result, it's one of very few retailers reporting increasing sales.įor the 35 weeks ended May 3, Costco reported net sales of $107.64 billion, an increase of 7.8 percent from $99.89 billion during the similar period last year. The company currently operates 787 warehouses, including 547 in the United States, with the rest distributed around the planet.Ĭostco adapted quickly to the coronavirus disruption, instituting social distancing rules, a limit of two customers admitted per membership card, reduced business hours, and devoted shopping times exclusively for seniors. Costco is one of the most dominant warehouse retailers, offering a tremendous range of quality merchandise, heavily discounted for its members. Meanwhile, Costco earlier this month released sales results for the previous 35 weeks. ![]() ![]() ![]() Constellation Brands hasn't recently commented on inventory levels, but Bill Kirk of research firm MKM Partners wrote, "ut-of-stock levels will get worse every day for the next 50 days." If inventories get depleted as we head into prime beer-drinking season, Constellation could see its market share slip.Ĭostco's warehouse-shopping model is more popular than ever Mexican health officials declined to comment about Constellation's ongoing production, and Labor Ministry officials didn't respond to a request for comment, as reported by Bloomberg. "We've had ongoing discussions with the Mexican government and continue to operate in compliance with the law," said Constellation spokesman Michael McGrew in an email response to Bloomberg's questions. have continued operations while others have closed, according to a May 5 report from Bloomberg. But somehow, the Constellation Brands breweries producing Modelo and Corona beer in Mexico for sales in the U.S. Because of the COVID-19 pandemic, the Mexican government declared beer production as non-essential and mandated closure of the breweries. Constellation Brands seemed to be rolling merrily along.īut a strange twist occurred on April 6.
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