Costco edges closer to the top with record earnings.(Costco Wholesale Corp.)

For Costco, 2005 went down as the year it became a truly elite general merchandise retailer. The 476-store chain ended its fiscal year last Aug. 29 with a whopping $52.9 billion in revenue, just edging out Target, and with only Sears and The Home Depot between it and the nation's largest retailer.

It was a remarkable year for Costco given the fact it produced a 10% increase in total sales with only 16 new store openings and generated record earnings of $1.06 billion. The driving force was a strong increase in same-store sales, which rose 7% in an economy plagued by rising gas prices.

Those trends have continued in 2006 and don't show any signs of letting up. …