I’ve been keeping an eye on Costco Wholesale Corporation (NASDAQ:COST) because I’m attracted to its fundamentals. Looking at the company as a whole, as a potential stock investment, I believe COST has a lot to offer. Basically, it is a financially-robust , dividend-paying company with a great track record of performance. Below is a brief commentary on these key aspects. For those interested in digging a bit deeper into my commentary, read the full report on Costco Wholesale here.
Outstanding track record with adequate balance sheet and pays a dividend
In the previous year, COST has ramped up its bottom line by 17%, with its latest earnings level surpassing its average level over the last five years. The strong earnings growth is reflected in impressive double-digit 24% return to shareholders, which paints a buoyant picture for the company. COST’s strong financial health means that all of its upcoming liability payments are able to be met by its current cash and short-term investment holdings. This suggests prudent control over cash and cost by management, which is a key determinant of the company’s health. COST appears to have made good use of debt, producing operating cash levels of 0.93x total debt in the prior year. This is a strong indication that debt is reasonably met with cash generated.
For those seeking income streams from their portfolio, COST is a robust dividend payer as well. Over the past decade, the company has consistently increased its dividend payout, reaching a yield of 0.9%.
For Costco Wholesale, I’ve compiled three essential factors you should look at:
- Future Outlook: What are well-informed industry analysts predicting for COST’s future growth? Take a look at our free research report of analyst consensus for COST’s outlook.
- Valuation: What is COST worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? The intrinsic value infographic in our free research report helps visualize whether COST is currently mispriced by the market.
- Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of COST? Explore our interactive list of stocks with large potential to get an idea of what else is out there you may be missing!
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.