Analyst: Costco May Be Raising Membership Dues

(RTTNews) - Costco Wholesale Corp. (COST) might be planning to raise its annual membership fee early next year, according to an analyst. The membership warehouses operator requires consumers to pay an annual membership fee to shop in its stores.

UBS analyst Michael Lasser wrote on Friday that the conditions are in place for Costco to hike its membership fee early next year.

The Issaquah, Washington-based company has historically raised its annual membership fee every five to six years, with the last increase being announced in November 2011.

According to Lasser, Costco might increase the annual fee for its basic Gold Star Membership to $60 from $55, while the fee for its Executive Membership might be raised to $120 from $110.

"If its [competition] were to dramatically slow in the meantime or if there were some major macro disruption, it might delay this increase. But, it sounds like that's not likely," Lasser wrote.

The Gold Star Membership is the cheapest membership at Costco and gives customers access to discounts ranging from 5 percent to 50 percent on select items. It includes a free, additional card for a household member living at the same address as the primary cardholder.

The Executive Membership is Costco's most expensive and gives customers an annual 2 percent reward on all purchases within the year.

For fiscal 2015, Costco reported membership fees of $2.53 billion, up 4 percent from the previous year. The company has loyal followers - about 91 percent of the company's U.S. customers renewed their membership in 2015.