Rising prices at the pump make retailers' hearts sink. Wal-Mart (WMT) gets hit hard, for example, as shoppers make fewer trips to the store and have less room in their budgets.

But Costco (COST) is one of the few retailers that do better as gas prices rise, writes analyst Mark Miller at William Blair & Co.

"With the typical seasonal uplift in gas prices leading up to Memorial Day, and with uncertainties in the Middle East, we now believe that gas prices should be a neutral, or potential positive, factor to Costco's sales going forward," Miller writes in a report Monday. He raised his rating on the stock to "outperform" from "market perform."

Costco shares traded up more than 1% Monday afternoon to $87.41. The stock is up more than 3% this year.

Costco benefits from higher gas prices because it sells its own gas at between 6 cents and 12 cents below the market price, according to Trefis. You can't buy gas there without a membership, and for some people it's a no-brainer to become a member just for the gas discount.

Let's say you have a car with a 17-gallon tank capacity. Filling up the tank completely at Costco might save you $1 to $2 each time -- probably enough to justify the $55 annual membership fee. And you get to buy enormous jars of pickles to boot.

Costco sells discounted gas on the expectation that it will lead to more visits and higher revenue in its stores. The company beat expectations last week for its second-quarter earnings, saying profit rose 13% while same-store sales increased. Shoppers spent 2.4% more per visit in the quarter, and visit frequency rose 5.2%.

Even after raising membership fees at the end of last year, Costco executives say the renewal trend is the best in the company's history, Miller writes after speaking with management. The company is aiming to increase first-year renewals and get new members to visit at least three times.