Costco's Higher Membership Fee

Plus, spot Bitcoin ETF decisions.

Today is Wednesday, September 27, 2023.

The Early Bird Index today is 52.49.

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Costco's Higher Membership Fee

Despite posting better-than-expected financial results, shares of the retail giant Costco (Nasdaq: COST) dropped by 2.49% in after-hours trading on Tuesday.

Financials: Costco reported earnings of $4.86 in the past quarter and revenue of $78.9 billion; both were better than expected.

Details: Revenue is up year-over-year for Costco, including more revenue from membership fees.

Yes, But: Overall comparable sales only increased by 1.1%, which represents a slowdown. In addition, sales in the U.S. only grew by 0.2%. Online sales shrunk by 0.8%.

Powering the Story: The biggest question on investors’ minds is whether Costco will finally raise its membership prices in the wake of higher inflation. During the earnings conference call, Costco said that it would eventually raise its membership fees, but not now. CFO Richard Galanti said that it was “a question of when, not if,” according to the Wall Street Journal.

Stock Price: Shares of Costco are up nearly 22% this year, including a 3% uptick in the last 30 days.

Final Thoughts: It’s a tough time in retail. Several major retailers are dealing with headwinds such as inflation and higher wages. Investors want Costco to roll out higher membership fees to counter these challenges.

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Notable Earnings Today: Micron Technology (Nasdaq: MU), Paychex (Nasdaq: PAYX), The Duckhorn Portfolio (NYSE: NAPA), Concentrix (Nasdaq: CNXC), H.B. Fuller (NYSE: FUL), Worthington (NYSE: WOR), Jefferies (NYSE: JEF), Aytu Bioscience (Nasdaq: AYTU), Sangoma Technologies (Nasdaq: SANG).

Notable IPOs Today: DoorDash, Inc. Class A Common Stock (Nasdaq: DASH), Lead Real Estate Co., Ltd American Depositary Shares (Nasdaq: LRE).

Notable Equity Crowdfunding Campaigns Ending Today: Fanbase (StartEngine), VEDX Solutions (Netcapital).

Notable Economic Events Today: Durable Goods Orders / Core Durable Goods Orders (8:30 a.m. ET), Crude Oil Inventories (10:30 a.m. ET).

Spot Bitcoin ETF Decisions Delayed, Again

Investors are going to have to wait a little longer to get a spot Bitcoin ETF (exchange-traded fund).

Details: The U.S. SEC announced Tuesday that a decision regarding the GlobalX ETF won’t be announced until November. It also delayed a decision for the Ark 21Shares ETF until January.

Definition: A spot Bitcoin ETF directly tracks the price of Bitcoin, unlike a futures Bitcoin ETF that indirectly tracks the price.

Background: The SEC has previously postponed decisions regarding the approval of a spot Bitcoin ETF in the U.S.

Final Thoughts: There are several spot Bitcoin ETF applicants who are awaiting decisions from the SEC. Analysts say that approval could come in a few months.

MillerKnoll’s Strong Financial Results

Furniture and furnishings company MillerKnoll (Nasdaq: MLKN) jumped by 16.71% in after-hours trading on Tuesday after posting better-than-expected financial earnings results.

Final Thoughts: MillerKnoll is down 9% this year as the furniture industry faces economic headwinds. The company raised its forecast on Tuesday, signaling that growth is coming.

Trends to Watch

Free and Open Internet: Biden Administration Plans to Bring Back ‘Net Neutrality’ Rules (The New York Times)

Shrinking: How Much Savings Do Americans Have Left, Anyway? (Wall Street Journal)

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