Costco, General Mills Report Earnings Amid U.S. Economic Data
Investors prepare for a week of key earnings and economic indicators, including Costco results and U.S. manufacturing PMIs.
Key points
- Costco Wholesale expects Q4 EPS of $6.48, up from $5.87 in the prior-year quarter.
- Canadian payroll employment grew by 4,800 jobs in June, following a 45,000 increase in May.
- General Mills projects an EPS of 71 cents, a decrease from 86 cents in the same period last year.
U.S. and Canadian markets face a data-dense week as major retailers and industrial firms release quarterly results. The schedule includes earnings from Costco Wholesale and General Mills, alongside critical economic indicators that signal the current state of the North American economy. According to The Globe and Mail, these releases will provide a clear picture of consumer spending trends and manufacturing momentum.
Investors are focused on how these companies perform against prior-year benchmarks. For instance, Costco is expected to report earnings per share of $6.48, a significant increase from $5.87 in the same quarter last year. This performance metric will be a primary indicator of retail sector health as the market assesses broader economic resilience.
Retailers Show Mixed Earnings Trajectories
Several major retailers are set to report diverging financial outcomes. AutoZone expects to post an EPS of $54.97, up from $48.71 a year earlier, reflecting strong sales performance. Conversely, Cracker Barrel Old Country Store projects a sharp decline in EPS to 20 cents from 74 cents in the prior-year quarter. These figures highlight varying degrees of success within the consumer-facing sector.
General Mills also faces challenges, with an expected EPS of 71 cents down from 86 cents in the previous year’s Q1. This drop suggests pressure on margins or sales volume for the packaged food giant. Meanwhile, Darden Restaurants anticipates modest growth, with EPS of $2.06 compared to $1.97 in the prior-year quarter, indicating steady but unremarkable progress in the dining sector.
Economic Indicators Reveal Labor Trends
Canadian labor data indicates a stabilizing but slow-growing employment market. Payroll employment increased by just 4,800 jobs in June, following a larger gain of 45,000 in May. On a year-on-year basis, employment is up by 155,000, or 0.8 percent, suggesting a gradual expansion rather than a rapid surge in hiring activity across the Canadian economy.
Retail sales in Canada rose 0.6 percent in June to reach $74.3 billion. This increase was driven by growth in seven of nine subsectors, with general merchandise retailers leading the gains. These figures suggest that despite modest employment growth, consumer spending remains a supportive factor for the domestic retail landscape.
Manufacturing Data Sets The Tone
The release of U.S. Flash Manufacturing and Services PMIs on Wednesday will be a key event for traders. These indices provide an early read on economic activity in the largest global economy. Combined with durable goods orders reported on Friday, these data points will help gauge the strength of industrial production and business investment ahead of the full-quarter reports.
