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Costco's quarterly profit tops estimates on tax benefit

Costco Wholesale on Thursday reported a better-than-expected quarterly profit, helped by a tax benefit related to its special cash dividend last month.

Revenue fell below forecasts, but sales at comparable stores excluding fuel sales rose 8 percent, more than the Street anticipated.

Costco, the third-largest U.S. retailer, said net income rose to $598 million, or $1.35 per share, for the second quarter ended Feb. 15, from $463 million, or $1.05 per share a year earlier.

Excluding one-time items, the company posted earnings of $1.25 a share.

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Total revenue, which includes membership fees, rose 4.4 percent in the quarter to $27.45 billion. Sales rose 4.3 percent $26.87 billion.

Analysts on average expected a profit of $1.18 per share on sales of $27.65 billion, according to Thomson Reuters.

Costco said its results include a tax benefit of $57 million, or 13 cents per share, in connection with the special cash.

Costco, which sells food and general merchandise in bulk and operates service stations, said comparable sales at outlets open more than one year grew 8 percent in the second quarter, excluding fuel.

Analysts polled by research firm Consensus Metrix had expected same-store sales to increase 6.4 percent. February comparable sales rose 1 percent, in line with analysts' expectations of 0.9 percent.

The bulk of the beat can be chalked up to the benefit of higher gas margins, John Heinbockel, analyst at Guggenheim Securities, told CNBC. While the overall quality of the sales was good, he said, Guggenheim remains cautious on the company's near-term prospects.

Heinbockel believes operating momentum at Costco, which gets most of its profit from annual membership fees, will slow during the next two to four quarters as gas margins normalize and the strong U.S. dollar remains a headwind.

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"We've had three quarters in a row of unprecedented gas margins," he said in a "Squawk Box" interview. As gas margins come down on a cents-per-gallon basis from the high teens to low-double digits, it will set up a tough earnings comparison later this year.That will actually hurt earnings in the winter and the first quarter of 2016, he said.

Retail stocks in general are currently elevated after investors ran up prices in anticipation of the benefits of lower gas prices, he said. In order to raise his neutral rating, he would need to see the retailer get through the next few quarters and past concerns that momentum will slow down.

DISCLOSURE: Neither the analyst nor his family own shares of Costco. His firm does not hold greater than a 1 percent stake in the stock. Guggenheim Securities provides investment banking services to Costco.

—CNBC.com's Tom DiChristopher contributed to this story,