Weekly Stock Pick

Scanning the stock charts this monday morning I've found a low risk high reward investment in a company in the discount variety stores industry that provides discounted goods from A to Z. They do have plenty of competition such as Walmart, Target, Family Dollar Stores, Dollar Tree, and BJ's Wholesale Club. None the less, consumers need these giant variety stores more than ever now with this current economic crisis still on-going.

Buy Long Costco. Ticker COST

Buy Entry: 49 to 55

Stop-Loss: 48

Take Profit Areas:

59.16 to 59.88

65.80

69.50

Costco October Net Sales Up

Costco reported net sales of $5.30 billion for the month of October, the four weeks ended November 2, 2008, an increase of two percent from $5.21 billion in the same four-week period last year.

For the first nine weeks of its reporting period ended November 2, 2008, the Company reported net sales of $11.97 billion, an increase of six percent from $11.26 billion during the similar period last year.

Excluding the negative effect of foreign exchange (particularly in Canada, the U.K. and Korea), international comparable sales for October increased 9% in local currency, and total Company comparable sales would have increased by 3% for the month. Gasoline price changes year-over-year had no material impact on sales for the month.

Costco currently operates 546 warehouses, including 400 in the United States and Puerto Rico, 76 in Canada, 20 in the United Kingdom, six in Korea, five in Taiwan, eight in Japan and 31 in Mexico.

Costco Company Profile from Google Finance

Costco Wholesale Corporation (Costco) operates membership warehouses-based offering its members products in a range of merchandise categories. It buys the majority of its merchandise directly from manufacturers and route it to a cross-docking consolidation point (depot) or directly to its warehouses. The Company’s depots receive container-based shipments from manufacturers and reallocate these goods for shipment to its individual warehouses, generally in less than 24 hours. The Company’s warehouse format averages approximately 140,000 square feet. Its warehouses operate on a seven-day, 69-hour week. It carries an average of approximately 4,000 active stockkeeping units (SKUs) per warehouse in its core warehouse business. Many consumable products are offered for sale in case, carton or multiple-pack quantities only. As of August 31, 2008, Costco operated 512 membership warehouses.

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Click the Costco Stock Chart for a larger view.