The Long Term Investor

Costco earnings.

Costco tops earnings and revenue estimates as sales jump 8%

https://www.cnbc.com/2025/05/29/costco-cost-q3-2025-earnings.html

(BOLD is my opinion OR what I consider important content)

"Key Points

• Costco on Thursday posted quarterly earnings and revenue that topped estimates as the warehouse club’s sales climbed 8%.
• Costco could stand to benefit from tariff volatility as it offers bulk discounts and competitive prices.

Costco on Thursday posted quarterly earnings and revenue that topped estimates as its sales climbed 8%.

Here’s how the warehouse club retailer did in its fiscal third quarter compared what Wall Street was expecting, based on a survey of analysts by LSEG:

• Earnings per share: $4.28 vs. $4.24 expected
• Revenue: $63.21 billion vs. $63.19 billion expected

Costco’s net income for the three-month period that ended May 11 rose to $1.90 billion, or $4.28 per share, compared to $1.68 billion, or $3.78 a year earlier. Revenue rose from $58.52 billion in the year-ago period.

As tariffs raise economic worries, and potentially consumer prices, Costco could stand to benefit. Unpredictable tariff policy could help drive more customers to the warehouse club, which is known for its competitive prices and bulk discounts, and encourage them to renew membership. Its clubs also sell discounted gas and groceries, which are steadier traffic drivers even when consumers pull back on spending. And compared with some other retailers, Costco has a stronger hand in price negotiations with suppliers because of its large size.

On the company’s earnings call in March, CEO Ron Vachris said customers rely on Costco more in a challenging economy.

“In uncertain times, our members have historically placed even greater importance on the value of high-quality items at great prices, and our teams will continue to rise to this challenge by leveraging our global buying power, strong supplier relationships and innovation,” Vachris said at the time.

About a third of Costco’s U.S. sales are goods brought in from other countries, with less than half of those imports coming from China, Mexico and Canada, Vachris said in March.

Yet tariffs could also add expenses for Costco, which could mean higher prices for shoppers. Earlier on Thursday, Best Buy

CEO Corie Barry said the retailer had already raised prices on some consumer electronics because of tariffs. Cosmetics company E.l.f. Beauty announced a price increase on its makeup last week. And Walmart
CFO John David Rainey warned earlier this month that higher prices were coming to the discounter’s stores and website in late May or June.

As of Thursday’s close, shares of Costco are up about 10% so far this year. That has outpaced the S&P 500′s less than 1% gains during the same period."

MY COMMENT

A good BEAT by COST. AND....lots of speculation about Tariff impact that has ZERO basis in fact.....so far.

 

Four stocks gave me a nice gain today....NVDA, MSFT, AMZN, and HD. I had a good medium/high gain today. I also beat the SP500 by 0.74% today.

Last market day of the week tomorrow.

 

I'm BACK......

Trump’s tariffs can continue for now, appeals court rules

https://www.washingtonpost.com/poli...ows-up-latest-roadblock-trumps-policy-agenda/

 

Actually my few shares with the most gain are just over 1000%. But that is a TINY share balance. As to my larger block purchases....the greatest gain...in a good size block of shares.... is between 800% and 900%. I happened to look the other night.

 

The markets are just.....an ASS. Here they are in the RED in the face of this story. After ALL the BS we have faced over the FED and inflation over the past year or three......and we get this and the markets do nothing. WTF.

AND...WTF...with the FED and all the people bitching about inflation going to go up any day now up. It is mostly just....WISHFUL THINKING....even by the FED....as they passively aggressively refuse to do anything.

Inflation rate slipped to 2.1% in April, lower than expected, Fed’s preferred gauge shows

https://www.cnbc.com/2025/05/30/inf...than-expected-feds-preferred-gauge-shows.html

(BOLD is my opinion OR what I consider important content)

"Key Points

• The personal consumption expenditures price index, the Federal Reserve’s key inflation measure, increased just 0.1% for the month, putting the annual inflation rate at 2.1%.
• Core inflation also was at 0.1% for the month though it was higher on an annual level at 2.5%.
• Consumer spending, though, slowed sharply for the month, posting just a 0.2% increase, while the savings rate surged to 4.9%, the highest in nearly a year.

Inflation barely budged in April as tariffs President Donald Trump implemented in the early part of the month had yet to show up in consumer prices, the Commerce Department reported Friday.

The personal consumption expenditures price index, the Federal Reserve’s key inflation measure, increased just 0.1% for the month, putting the annual inflation rate at 2.1%, the lowest of 205. The monthly reading was in line with the Dow Jones consensus forecast while the annual level was 0.1 percentage point lower.

Excluding food and energy, the core reading that tends to get even greater focus from Fed policymakers showed readings of 0.1% and 2.5%, against respective estimates of 0.1% and 2.6%. Central bank officials believe core is a better indicator of longer-term trends.

Consumer spending, though, slowed sharply for the month, posting just a 0.2% increase, in line with the consensus but slower than the 0.7% rate in March. A more cautious consumer mood also was reflected in the personal savings rate, which jumped to 4.9%, up from 0.6 percentage point in March to the highest level in nearly a year.

Personal income surged 0.8%, a slight increase from the prior month but well ahead of the forecast for 0.3%.

Food prices fell 0.3% on the month while energy goods and services increased 0.5%. Shelter costs, which has been one of the most stubborn inflation components, increased 0.4%.

Markets showed little reaction to the news, with stock futures continuing to point lower and Treasury yields mixed.

Trump has been pushing the Fed to lower its key interest rate as inflation has continued to gravitate back to the central bank’s 2% target. However, policymakers have been hesitant to move as they await the longer-term impacts of the president’s trade policy.

“Much bigger increases in core goods inflation probably loom as the costs of the new tariffs are eventually passed on,” wrote Oliver Allen, senior economist at Pantheon Macroeconomics “Accordingly, we still think core PCE inflation will peak later this year between 3.0% and 3.5%, if the current mix of tariffs remains in place.”

On Thursday, Trump and Fed Chair Jerome Powell held their first face-to-face meeting since the president started his second term. However, a Fed statement indicated the future path of monetary policy was not discussed and stressed that decisions would be made free of political considerations.

Trump slapped across-the-board 10% duties on all U.S. imports, part of an effort to even out a trading landscape in which the U.S. ran a record $140.5 billion deficit in March. In addition to the general tariffs, Trump launched selective reciprocal tariffs much higher than the 10% general charge.

Since then, though, Trump has backed off the more severe tariffs in favor of a 90-day negotiating period with the affected countries. Earlier this week, an international court struck down the tariffs, saying Trump exceeded his authority and didn’t prove that national security was threatened by the trade issues.

Then in the latest installment of the drama, an appeals court allowed a White House effort for a temporary stay of the order from the U.S. Court of International Trade.

Economists worry that tariffs could spark another round of inflation, though the historical record shows that their impact is often minimal.

At their policy meeting earlier this month, Fed officials also expressed worry about potential tariff inflation, particularly at a time when concerns are rising about the labor market. Higher prices and slower economic growth can yield stagflation, a phenomenon the U.S. hasn’t seen since the early 1980s.

MY COMMENT

One of the best inflation readings in many years......and....half or more of the article is beating the quickly aging and soon to be dead horse......the TARIFFS and the fantasy inflation that the so called experts (political partisans) are hoping for. Soon they are not going to be able to fear-monger the coming tariff inflation. It will sound a little ridiculous as we go through month after month with NO tariff inflation showing up.

This report is a real GEM....exactly what should have all the economists and FED watchers and FED members....CHEERING. Not to mention.....THE MARKETS.

 

Here is the one little kernel of true buried in the second half of the article above quoting so called "EXPERTS" on the coming TARIFF INFLATION. As I said wishful thinking and political partisan fantasy.

"Economists worry that tariffs could spark another round of inflation, though the historical record shows that their impact is often minimal."

GEE....lets see....I can trust and believe what the actual historical record shows from actual past experiences and actual FACT. OR....I can believe a bunch of so called "JOURNALISTS" spouting opinions and pushing a certain view point. Seems like a pretty clear cut choice to me.

 

To continue the above theme:

Costco Defies Tariff Shifts With Higher Profit, Lower Prices

https://finance.yahoo.com/news/costco-defies-tariff-shifts-higher-114004514.html

 

HERE is another....report......with the mandatory fear-mongering opinion. The bottom line.....inflation is now at 2.1% BUT.....OMG.....it is still above the FED target of 2.0%. Yeah right......by 0.10%. Basically a rounding error.

Fed's preferred inflation gauge shows price increases cooled in April

https://finance.yahoo.com/news/feds...rice-increases-cooled-in-april-123353525.html

(BOLD is my opinion OR what I consider important content)

"The latest reading of the Federal Reserve's preferred inflation gauge showed price increases slowed in April as inflation remained above the Fed's 2% target. The release comes as investors have been closely watching data releases for signs of how President Trump's tariff policy is impacting the economy.

The "core" Personal Consumption Expenditures (PCE) index, which strips out food and energy costs and is closely watched by the central bank, rose 2.5% on an annual basis, in line with expectations and lower than the 2.7% seen in March. Core prices rose 0.1% in April from the prior month, in line with expectations and the monthly increase seen in March.

On a yearly basis, PCE increased by 2.1%, below the 2.2% economists had expected.

The release is yet another sign that while economists and consumers alike expect Trump's tariffs to push prices higher, the inflationary impact from policy largely isn't showing up in hard economic data. Friday morning's release reflects the month of April, the first month in which a large portion of Trump's tariffs were in effect.

It does not include any impacts from the 90-day tariff pause between the US and China.

"The increased tariffs have not yet worked their way into the consumer inflation readings, but we anticipate that the improved inflation trend will reverse in the second half of the year as companies are forced to begin passing along a portion of the increased tariffs in order to protect profit margins," Nationwide chief economist Kathy Bostjancic wrote in a research note on Friday.

On Wednesday, minutes from the Federal Reserve's May meeting revealed officials are growing increasingly concerned about how Trump's policies could impact its fight against inflation.

"Almost all participants commented on the risk that inflation could prove to be more persistent than expected," the minutes read."

MY COMMENT

ALL the drama and BS of the past two months since April 2 and a month or two prior......reminds me of the constant and relentless SCREAMING about the coming RECESSION we had to ENDURE over the recent past. When was that....6-12 months ago? I cant remember.....I do remember that the GHOST recession NEVER happened. AND....all the market turmoil and fear and doom and gloom......well....NEVER MIND.

As stated above:

"The release is yet another sign that while economists and consumers alike expect Trump's tariffs to push prices higher, the inflationary impact from policy largely isn't showing up in hard economic data."

BUMMER.....for the GLEEFUL fear-mongers. WRONG as usual.

UNFORTUNATELY for us....the markets are impacted by all the fear mongering and constant doom and gloom. The news reporting.......well most of it is actually simply wishful OPINION......is wrong, wrong, wrong, as usual....but the impact on markets is REAL. EVERY time we have seen earnings over the past 15-20 quarters....we have had to face a WALL of BS in the media. AND in the end.....all that BS washes out the impact of VERY POSITIVE earnings.

 

With the nearly $2 drop in NVDA today we have now seen the MARKET impact of the BIG EARNINGS BEAT.....cut to about $2-$3 per share.

Talk about washing out a great report with doom and gloom.

As I have said many times.....sooner or later this BS WILL start to show up in and impact time spans in the markets much longer than the short term. Some day we are going to wake up and realize....in hindsight.... that, GEE the markets dont work anymore like they used to.....earnings and fundamentals dont matter anymore..... we have totally screwed up the markets with opinion BS that is now RAMPANT and disconnected from reality.

 

Money moves around with momentum....no doubt. BUT....in reality there is not much competition between PLTR and NVDA....they are parallel companies with little overlap in their businesses other than being involved with AI. What is good for one is good for the other.

Most of the money in PLTR is little retail investor money. The Hedge funds and professional investors.....ignore it. I TRUST the little investor to identify up and coming companies far more than I trust the "experts" and the ELITES.

 

This is interesting.....and makes sense.

As EVs stumble, automakers are bringing back a kind of hybrid that promises long range

https://www.cnbc.com/2025/05/30/aut...kind-of-hybrid-that-promises-long-range-.html

"Key Points

• A brief era for the extended-range hybrid electric vehicle auto came and went with models like the Chevy Volt and BMW i3.
• Now, the EREV may be poised for a comeback, with new models coming from Hyundai, Jeep, Ram, and a division of Volkswagen, and other manufacturers considering the technology with total ranges well-exceeding 500 miles when coupled with their gas engines.
• In China, where EREVs are gaining in popularity, BYD offers mid-sized sedans with more than 1,300 miles of claimed range."

........"Extended-range electric vehicles (EREVs) are a form of plug-in hybrid that falls midway between traditional hybrids and full EVs. EREV cars and trucks rely on battery powered motors for propulsion (like an EV) but also have a relatively small gas engine to use as a generator to keep the batteries charged up (like a typical hybrid). A key difference between EREVs and other hybrids is the relative size of their batteries and gas engines.".......

MY COMMENT

Sounds very interesting. We drive a regular HYBRID daily. We get 630-650 miles out of a tank of gas. It saves us at least half of what we used to spend for gas each month. it sounds like we are not too far from being able to get 1000 miles or more per tank with these EREV hybrid models.

I like the very smart emphasis on the EV side of these EREV hybrids versus the gas engine side. Basically an electric vehicle with a small gas engine to recharge the batteries....versus a gas vehicle with a secondary battery and EV system. SMART.