About Costco Wholesale Corporation
Costco Wholesale Corporation, together with its subsidiaries, engages in the operation of membership warehouses in the United States, Puerto Rico, Canada, Mexico, Japan, the United Kingdom, Korea, Australia, Taiwan, China, Spain, France, Iceland, New Zealand, and Sweden. It offers merchandise, including sundries, dry groceries, candies, coolers, freezers, deli, liquor, and tobacco; non-food merchandise comprising appliances, small electronics, health and beauty aids, hardware, lawn and garden, sporting goods, tires, toys and seasonal, automotive, stamps, tickets, apparel, furniture, domestics, housewares, special order kiosks, and jewelry; and fresh food, such as meat, produce, service deli, and bakery products. The company is also involved in warehouse ancillary operations, which include gasoline, pharmacies, optical, food courts, hearing-aid centers, and tire installation centers. In addition, it engages in e-commerce, business centers, travel, and other businesses. The company was formerly known as Costco Companies, Inc. and changed its name to Costco Wholesale Corporation in August 1999. Costco Wholesale Corporation was founded in 1976 and is based in Issaquah, Washington.
Costco Wholesale Corporation (COST) is a Consumer Defensive company in the Discount Stores industry with a market capitalisation of $401.2B. The stock trades at 45.47x trailing earnings and yields 0.65%.
- Sector
- Consumer Defensive
- Industry
- Discount Stores
- Market cap
- $401.2B
- P/E ratio
- 45.47
- Forward P/E
- 39.98
- EPS (TTM)
- $19.90
- Revenue (TTM)
- $293.6B
- Free cash flow
- $7B
- Profit margin
- 3.0%
- Dividend yield
- 0.65%
- Beta
- 0.85
- Shares outstanding
- 443.5M
Financial health: Fair6.8/10
7 strengths, 3 concerns. Weakest points: gross margin, net margin, peg ratio.
- Debt to equity: 0.20 (Strong, benchmark < 0.5) — Debt of 0.20x equity is conservative against the 0.5x benchmark. It has improved over the last 4 years.
- Net debt vs cash flow: 0.0y (Strong, benchmark < 4 years) — Holds more cash than debt ($9.5B net cash).
- Current ratio: 1.03 (Watch, benchmark > 1.5) — Short-term assets cover 1.03x short-term liabilities, against Graham's 1.5x floor. It has been broadly flat over the last 4 years.
- Return on equity: 29.1% (Strong, benchmark > 15%) — Earns 29.1% on shareholder equity, comfortably past the > 15% mark.
- Gross margin: 12.9% (Concern, benchmark > 40%) — Keeps 12.9% of revenue after the direct cost of sales, well short of the > 40% mark.
- Net margin: 3.0% (Concern, benchmark > 10%) — Turns 3.0% of revenue into profit, well short of the > 10% mark.
- Free cash flow: $7.8B (Strong, benchmark positive) — Generated $7.8B of free cash flow after capital spending. It has improved over the last 4 years.
- Revenue growth: 21.5% (Strong, benchmark > 10%) — Revenue changed 21.5% year on year, comfortably past the > 10% mark.
- Earnings growth: 45.5% (Strong, benchmark > 10%) — Earnings changed 45.5% year on year, comfortably past the > 10% mark.
- PEG ratio: 4.43 (Concern, benchmark < 1) — At 4.43, the price looks expensive relative to expected growth — Lynch treated 1.0 as fair value.
- Payout ratio: 27.0% (Strong, benchmark < 60%) — Pays out 27.0% of earnings as dividends, leaving room to keep paying.