Costco (COST) shares are ticking higher before the market open — the stock price has since moved lower in active trading hours — after the wholesale retailer announced it is hiking its membership fee for the first time since 2017. Morning Brief Hosts Seana Smith and Brad Smith report more on the move and how the $5 hike will impact the business in the long run.
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This post was written by Melanie Riehl
Video Transcript
Time for some trending tickers, Costco shares climbing this morning after announcing it’s hiking its membership fees for the first time since 2017.
Effective September 1st members of us and Canada Gold Star business and business will, uh, will business add on rather will pay $5 more for their membership.
Now, that brings a new annual cost to 65 bucks, you said this wasn’t a big deal in our morning meeting?
Well, it’s not a huge in terms of the fact that maybe that price increase could have been a lot more.
Right.
It’s five bucks.
Yes, I’m not discounting the five bucks.
But if you are a loyal, uh, Costco shopper, I don’t think you might be too upset.
Maybe I’m wrong, um, about a five buck hike it when it comes to the membership fees.
And the reason I bring that up is because Wall Street has been waiting for this to be announced.
Now, for several quarters, every single time earning season rolls around.
It’s almost the first or second or third thing that’s us is about membership fees and how big of a catalyst this could potentially be for the stock and there’s been a number of analysts who have run through the numbers saying that there has been a performance in Costco stock leading up to the membership hype because Wall Street then starting to price that in ultimately what that’s going to mean for the bottom line.
So again, that’s why we’re seeing some excitement in chairs here this morning just in terms of maybe how big of a boost this is going to be to Costco in the quarters to come.
But again, this has a move that we have been waiting for for quite some time.
I don’t not necessarily say that we were personally excited about it if you’re, if you’re a Costco consumer, but again, if you’re an investor in Costco, what this will ultimately do to the business in the long run, that’s something to be excited about.
Fair enough.
I I’m just saying divide it up, that is uh three and one third hot dogs that you’re missing out on every month because you’re paying that $5 extra here.
I don’t know, it might be good for the waist line, but Costco probably reading some of the tea leaves of consumer purchases.
If you can purchase gold bars at Costco, you can probably afford to pay a little $5 extra per month.