COST

Costco WholesaleNasdaqGS:COST Stock Report

Market Cap

US$203.1b

7D

-1.2%

1Y

36.8%

Updated

18 Sep, 2021

Data

Company Financials +
COST fundamental analysis
Snowflake Score
Valuation1/6
Future Growth2/6
Past Performance6/6
Financial Health3/6
Dividends4/6

COST Overview

Costco Wholesale Corporation, together with its subsidiaries, engages in the operation of membership warehouses in the United States, Puerto Rico, Canada, the United Kingdom, Mexico, Japan, Korea, Australia, Spain, France, Iceland, China, and Taiwan.

Costco Wholesale Competitors

Price History & Performance

Summary of all time highs, changes and price drops for Costco Wholesale
Historical stock prices
Current Share PriceUS$459.51
52 Week HighUS$307.00
52 Week LowUS$469.77
Beta0.65
1 Month Change1.16%
3 Month Change20.64%
1 Year Change36.78%
3 Year Change95.74%
5 Year Change201.26%
Change since IPO4,736.95%

Recent News & Updates

Sep 08

Costco Stock: Priced For Near Perfection

Costco is set to report its fiscal Q4 results later this month, after posting a strong beat in fiscal Q3, with revenue up 21% year-over-year, and 3% ahead of estimates. Given the company's strong July/August net sales, it looks like the company should post a solid fiscal Q4 performance, with revenue set to increase ~15% year-over-year to a new record. However, at more than 45x FY2021 earnings estimates, Costco looks priced for near perfection, with this figure being well above stock's historical earnings multiple. In summary, I see no way to justify chasing the stock above $460.00, and I would view rallies above $477.00 before year-end as an opportunity to book some profits.

Sep 08
Costco Wholesale (NASDAQ:COST) Might Become A Compounding Machine

Costco Wholesale (NASDAQ:COST) Might Become A Compounding Machine

There are a few key trends to look for if we want to identify the next multi-bagger. In a perfect world, we'd like to...

Aug 26
Costco Wholesale (NASDAQ:COST) is Surprisingly Good at Delivering Returns

Costco Wholesale (NASDAQ:COST) is Surprisingly Good at Delivering Returns

Costco Wholesale (NASDAQ:COST), has been around since 1976, and the company delivered a 1-year total return of 35.6%. That is quite impressive for this mature, US$200 billion Market Cap Company. Costco is the 3rd largest retailer with 809 warehouses worldwide and US$186b trailing twelve months revenue.

Aug 16

Costco: I Love The Company, Not The Valuation

Costco is up ~20% YTD as U.S. equities continue to rise to all-time highs. As of August 16th, the company has a market capitalization of $200.2B. Historically, I have been bullish on Costco given its unique business model, exceptional brand recognition, and impressive financial performance. Under many market conditions, I would seriously consider buying Costco stock; however, under current market conditions, the company’s valuation is too high to justify buying.

Aug 15
Should You Be Adding Costco Wholesale (NASDAQ:COST) To Your Watchlist Today?

Should You Be Adding Costco Wholesale (NASDAQ:COST) To Your Watchlist Today?

It's only natural that many investors, especially those who are new to the game, prefer to buy shares in 'sexy' stocks...

Shareholder Returns

COSTUS Consumer RetailingUS Market
7D-1.2%-0.9%-0.6%
1Y36.8%17.8%33.8%

Return vs Industry: COST exceeded the US Consumer Retailing industry which returned 17.8% over the past year.

Return vs Market: COST exceeded the US Market which returned 33.8% over the past year.

Price Volatility

Is COST's price volatile compared to industry and market?
COST volatility
COST Beta0.65
Industry Beta0.60
Market Beta1

Stable Share Price: COST is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 2% a week.

Volatility Over Time: COST's weekly volatility (2%) has been stable over the past year.

About the Company

FoundedEmployeesCEOWebsite
1976214,500W. Jelinekhttps://www.costco.com

Costco Wholesale Corporation, together with its subsidiaries, engages in the operation of membership warehouses in the United States, Puerto Rico, Canada, the United Kingdom, Mexico, Japan, Korea, Australia, Spain, France, Iceland, China, and Taiwan. It offers branded and private-label products in a range of merchandise categories. The company provides dry and packaged foods, and groceries; snack foods, candies, alcoholic and nonalcoholic beverages, and cleaning supplies; appliances, electronics, health and beauty aids, hardware, and garden and patio products; meat, bakery, and deli products, as well as produce; and apparel and small appliances.

Valuation

Is Costco Wholesale undervalued compared to its fair value and its price relative to the market?

1.2%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: COST ($459.51) is trading below our estimate of fair value ($465.05)

Significantly Below Fair Value: COST is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: COST is poor value based on its PE Ratio (43x) compared to the US Consumer Retailing industry average (20.8x).

PE vs Market: COST is poor value based on its PE Ratio (43x) compared to the US market (17.8x).


Price to Earnings Growth Ratio

PEG Ratio: COST is poor value based on its PEG Ratio (5.3x)


Price to Book Ratio

PB vs Industry: COST is overvalued based on its PB Ratio (12.3x) compared to the US Consumer Retailing industry average (2.3x).


Future Growth

How is Costco Wholesale forecast to perform in the next 1 to 3 years based on estimates from 26 analysts?

8.1%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: COST's forecast earnings growth (8.1% per year) is above the savings rate (2%).

Earnings vs Market: COST's earnings (8.1% per year) are forecast to grow slower than the US market (14.9% per year).

High Growth Earnings: COST's earnings are forecast to grow, but not significantly.

Revenue vs Market: COST's revenue (7.2% per year) is forecast to grow slower than the US market (9.8% per year).

High Growth Revenue: COST's revenue (7.2% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: COST's Return on Equity is forecast to be high in 3 years time (25%)


Past Performance

How has Costco Wholesale performed over the past 5 years?

13.9%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: COST has high quality earnings.

Growing Profit Margin: COST's current net profit margins (2.5%) are higher than last year (2.3%).


Past Earnings Growth Analysis

Earnings Trend: COST's earnings have grown by 13.9% per year over the past 5 years.

Accelerating Growth: COST's earnings growth over the past year (27.4%) exceeds its 5-year average (13.9% per year).

Earnings vs Industry: COST earnings growth over the past year (27.4%) exceeded the Consumer Retailing industry 25%.


Return on Equity

High ROE: COST's Return on Equity (28.2%) is considered high.


Financial Health

How is Costco Wholesale's financial position?


Financial Position Analysis

Short Term Liabilities: COST's short term assets ($27.9B) do not cover its short term liabilities ($28.0B).

Long Term Liabilities: COST's short term assets ($27.9B) exceed its long term liabilities ($12.3B).


Debt to Equity History and Analysis

Debt Level: COST's debt to equity ratio (44.7%) is considered high.

Reducing Debt: COST's debt to equity ratio has increased from 43.5% to 44.7% over the past 5 years.

Debt Coverage: COST's debt is well covered by operating cash flow (135.2%).

Interest Coverage: COST's interest payments on its debt are well covered by EBIT (56x coverage).


Balance Sheet


Dividend

What is Costco Wholesale current dividend yield, its reliability and sustainability?

0.69%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: COST's dividend (0.69%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.33%).

High Dividend: COST's dividend (0.69%) is low compared to the top 25% of dividend payers in the US market (3.6%).


Stability and Growth of Payments

Stable Dividend: COST is not paying a notable dividend for the US market, therefore no need to check if payments are stable.

Growing Dividend: COST is not paying a notable dividend for the US market, therefore no need to check if payments are increasing.


Current Payout to Shareholders

Dividend Coverage: COST is not paying a notable dividend for the US market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of COST's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

14.3yrs

Average management tenure


CEO

W. Jelinek (69 yo)

9.67yrs

Tenure

US$8,279,552

Compensation

Mr. W. Craig Jelinek has been the President and Chief Executive Officer of Costco Wholesale Corporation since February 2010 and January 1, 2012 respectively and served as its Executive Vice President of Me...


CEO Compensation Analysis

Compensation vs Market: W.'s total compensation ($USD8.28M) is about average for companies of similar size in the US market ($USD11.36M).

Compensation vs Earnings: W.'s compensation has been consistent with company performance over the past year.


Leadership Team

Experienced Management: COST's management team is seasoned and experienced (14.3 years average tenure).


Board Members

Experienced Board: COST's board of directors are considered experienced (5.9 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: COST insiders have only sold shares in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Costco Wholesale Corporation's employee growth, exchange listings and data sources


Key Information

  • Name: Costco Wholesale Corporation
  • Ticker: COST
  • Exchange: NasdaqGS
  • Founded: 1976
  • Industry: Hypermarkets and Super Centers
  • Sector: Consumer Retailing
  • Market Cap: US$203.135b
  • Shares outstanding: 442.07m
  • Website: https://www.costco.com

Number of Employees


Location

  • Costco Wholesale Corporation
  • 999 Lake Drive
  • Issaquah
  • Washington
  • 98027
  • United States

Listings


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/09/18 22:02
End of Day Share Price2021/09/17 00:00
Earnings2021/05/09
Annual Earnings2020/08/30


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.