Costco (NASDAQ:COST) Should Meet High Expectations Says UBS (NYSE:UBS)

UBS (NYSE:UBS) says that in spite of high expectations toward Costco Wholesale (NASDAQ:COST) should be able to deliver on those expectations in the first quarter.

They said, "We believe Costco is poised to deliver solid 1Q2011 EPS performance on 12/8, driven by expense management on improved sales trends, strong membership income and prospects for a modest gross margin gain. We have raised our 1Q EPS estimate to an above consensus $0.72 from $0.68, reflecting a positive revision to our prior sales and margin forecasts. Our 2011E EPS goes to $3.36 from $3.33 prior."

UBS maintains a "Neutral" on Costco Wholesale, which closed Monday at $69.19, up by $0.80, or 1.17 percent. They raised their price target on Costco from $65 to $68.