By Connor Hart

With BJ's Wholesale Club and Costco Wholesale both set to report earnings this week, Wall Street will be watching for further commentary on consumer sentiment. Warehouse clubs have benefited from inflation-weary shoppers' search for value, with chains luring fee-paying members away from competitors with supersized packages of food sold at lower per-unit prices. Investors will be looking to see if that growth continued in the latest quarter.

The context

BJ's Chief Executive Bob Eddy said last quarter that consumers remain weary of higher prices. That was especially true for lower-income shoppers, who pulled back on some spending and were more often searching for deals, leaning into promotions and trading down to cheaper, private-brand products, he said.

Overall, though, consumers were resilient and purchasing habits have stayed consistent, Eddy said.

UBS analysts said they expect BJ's to have finished last year on strong footing, benefiting from its value proposition and investments in fresh foods, which likely helped it gain market share in grocery. "Still, our conversations with investors suggest some nervousness about the year ahead," they added.

Membership-fee income growth is poised to decelerate as the retailer works its way through its deferred-accounting process, the analysts said. Plus, there's skepticism about the health of its core customer and the degree of risk it faces from lower funding for the Supplemental Nutrition Assistance Program, or SNAP.

Costco's membership growth has slowed down slightly in recent years, and the slowdown has prompted the wholesale retailer to aggressively open more locations in order to drive membership growth. It opened eight net new warehouses last quarter and plans to open 30 or more annually in future years, Chief Executive Ron Vachris previously said.

Costco has also been adding new features to its executive membership, such as exclusive extended shopping hours, to try to attract more customers.

UBS analysts said the retailer's upcoming report will likely be supportive of the bull case on the stock. While there could be some puts and takes, they said the readout should lean positively on debates surrounding whether Costco can sustain its sales momentum, improve margins, gain new members and invest on technology and productivity.

The numbers

BJ's is projected to post adjusted earnings of 93 cents a share on sales of $5.54 billion when it reports fourth-quarter results ahead of Thursday's opening bell. A year earlier, the warehouse club notched adjusted earnings of 93 cents a share on sales of $5.28 billion.

Comparable sales, which account for store openings and closings, are projected to climb 1.9%, according to FactSet. That compares with a 4.6% gain last year.

Costco--scheduled to report its fiscal second-quarter results after the market closes Thursday--is expected to post adjusted earnings of $4.55 a share on sales of $69.29 billion, compared with adjusted earnings of $4.02 a share on sales of $63.72 billion a year earlier.

The Issaquah, Wash., retailer's same-store sales are forecast to be up 6.3%, compared with a 6.8% increase last year.

Write to Connor Hart at connor.hart@wsj.com

(END) Dow Jones Newswires

March 04, 2026 14:08 ET (19:08 GMT)

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