Trying to time the market is never a good idea. And yet it looks like my retirement portfolio might have caught a lucky break with the most recent earnings release from PriceSmart
A close look at the numbers shows that if you haven't bought a piece of this Costco
Crushing estimates
It's a good time to be a retailer. U.S.-based retailer Target
The company models its membership structure off Costco, BJ's Wholesale Club
A look at how PriceSmart has fared against analyst estimates over the past eight quarters shows consistent and significant beats.
Q3 2011 |
Q2 2011 |
Q1 2011 |
Q4 2010 |
Q3 2010 |
Q2 2010 |
Q1 2010 |
Q4 2009 |
|
---|---|---|---|---|---|---|---|---|
Estimate | $0.46 | $0.57 | $0.44 | $0.33 | $0.35 | $0.43 | $0.34 | $0.30 |
Actual | $0.55 | $0.60 | $0.50 | $0.44 | $0.40 | $0.46 | $0.35 | $0.35 |
% Beat | 20% | 5% | 16% | 33% | 14% | 7% | 3% | 17% |
Source: Earnings.com.
Crazy organic growth
Because the company has only opened up one new store over the past year, almost all of the growth can be attributed to purely organic, same-store growth. This is good news for the company and a sign that locals, as well as expats who are retiring to warmer climates, are becoming regulars at the store.
Check out how revenue and earnings both grew in the double digits, and margins expanded by 34 basis points.
Q3 2010 |
Q3 2011 |
Change |
|
---|---|---|---|
Revenue | $348.6 | $431.1 | 24% |
Net Income | $12.0 million | $16.3 million | 36% |
Profit Margin | 3.44% | 3.78% |
Source: PriceSmart earnings release.
Foolish takeaway
With only 28 stores currently in the Caribbean and Central America, there's still tons of room for growth, especially with all of South America ripe for the picking. I suggest you add PriceSmart to your watchlist today.