Piper Jaffray Reiterates Overweight on Costco Wholesale

Piper Jaffray reiterates its Overweight rating on Costco Wholesale (NASDAQ: COST) following COST's 1Q earnings results.

In a note to clients, Piper Jaffray writes, "COST's Q1 EPS of $0.71 was better than consensus and PJC of $0.69. Q1 comps were strong at +7%, with September, October and November comps running at +5%, +6% and +9% respectively. Merch margin was in line with our expectation of ~+10bps y/y (10.98%) due to core merch +19bps, ancillary -9bps, 2% reward -1bps and LIFO 0bps with ~+3bps of the increase being due to Mexico."

Piper Jaffray raises its price target on COST from $72 to $83.

COST closed yesterday at $69.25.