Goldman Sachs maintained a Neutral Costco Wholesale (NASDAQ: COST) with a price target of $126. Analyst Matthew J. Fassler said he expects a "subdued negative reaction" to Q3 results -- the company's fourth straight miss, he noted.

"COST reported F3Q14 EPS of $1.07 vs. $1.04 a year ago, missing our $1.14 estimate and the Street’s $1.09. The miss vs. our model was driven by a shortfall in retail sales, driven by a bigger drag from FX, lower gross margin, and higher expenses, partially offset by a lower tax rate (worth $0.02 vs. our model)," said Fassler.

"Analysis

• *Sales tracked light of our model, driven by a greater drag from FX. 6% overall SSS growth excluding gas and FX tracked in line with our 5.9% forecast. SSS including gas and FX grew 4%, missing our 5.0%. International SSS growth excluding FX (-8%) met our 7.7% forecast (informed by monthly reports capturing much of F3Q), but missed when including FX (+3% vs. our +4.1% estimate). This drove the overall SSS miss, and a 0.5% retail sales shortfall. The quarter appeared to end well for the stub period not yet reported in monthly updates.
• Member fee revenue met our forecast precisely at $561mn.
• *Gross margin fell short of our estimate and declined yoy. We expected some relief, and look for additional color on drivers and the outlook.
• SG&A expenses tracked slightly higher. Pre-opening tracked above, on 6 openings vs. our 4 and higher pre-opening costs per unit.
• Tax rate (33.8% vs. our 35.0%) added $0.02 of EPS vs. our model.
• It is unclear whether COST repurchased stock; we will look for color on
  the call," he said.

For an analyst ratings summary and ratings history on Costco Wholesale click here. For more ratings news on Costco Wholesale click here.

Shares of Costco Wholesale closed at $114.24 yesterday.