We will not budge on $1.50 hot dog and soda combo

Believe it or not, Costco is known more for its legendary $1.50 hot dog and soda combo than its steady stream of solid financial results over the past 30 plus years.

And despite stubbornly elevated inflation, that mouth-watering price is seemingly here to stay.

Longtime Costco CEO Craig Jelinek tells Yahoo Finance he has no plans to raise the price of the hot dog/soda combo — nor does he have plans to cut the price for it seeing as rival Sam’s Club lowered the price for its similar offering to $1.38.

“We are very happy with our $1.50 hot dog and we have no plans to change it,” Jelinek said, adding that the company saves money by making its own hot dogs from a production plant.

Customers wait in line to order below signage for the Costco Kirkland Signature $1.50 hot dog and soda combo, which has maintained the same price since 1985 despite consumer price increases and inflation, at the food court outside a Costco Wholesale Corp. store on June 14, 2022 in Hawthorne, California. (Photo by Patrick T. FALLON / AFP) (Photo by PATRICK T. FALLON/AFP via Getty Images) — Customers wait in line at the food court outside a Costco Wholesale Corp. store on June 14, 2022 in Hawthorne, California. (Photo by Patrick T. FALLON / AFP)

To be sure, the 2022 Yahoo Finance Company of the Year sold a lot of hot dogs — and other merchandise — in its most recent quarter.

The warehouse retailer reported late Thursday that fiscal first quarter same-store sales rose 6.6% from a year ago, fueled by strength in gas and food sales. Membership fee income and earnings rose 5.7% and 3%, respectively, compared to the prior year.

Costco stock of increased slightly on Friday, even as quarterly earnings slightly missed analyst forecasts. The company also held off on signaling the precise timing of a long-awaited by Wall Street increase in membership fees.

“Costco’s membership model continues to drive predictable sales and profitability in an increasingly uncertain environment,” Jefferies analyst Corey Tarlowe stated in a note to clients.

Tarlowe maintained a buy rating on Costco’s stock with a $610 price target.

Brian Sozzi is an editor-at-large and anchor at Yahoo Finance. Follow Sozzi on Twitter @BrianSozzi and on LinkedIn.

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Source: https://finance.yahoo.com/news/costco-ceo-we-will-not-budge-on-150-hot-dog-and-soda-combo-164300813.html