Costco Wholesale Corp.

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COST : NASDAQ : Retail Trade
$188.12 | %
Today's Range: 0.0 - 0.0
Avg. Daily Volume: 2748700.0
02/20/18 - 4:00 PM ET

Financial Analysis


COSTCO WHOLESALE CORP's gross profit margin for the first quarter of its fiscal year 2018 is essentially unchanged when compared to the same period a year ago. The company managed to grow both sales and net income at a faster pace than the average competitor in its industry this quarter as compared to the same quarter a year ago. COSTCO WHOLESALE CORP has very weak liquidity. Currently, the Quick Ratio is 0.41 which clearly shows a lack of ability to cover short-term cash needs. The company's liquidity has increased from the same period last year.

During the same period, stockholders' equity ("net worth") has decreased by 7.47% from the same quarter last year. The key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the near future.

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Income Statement Q1 FY18 Q1 FY17
Net Sales ($mil)31809.028099.0
EBITDA ($mil)1286.01095.0
EBIT ($mil)951.0798.0
Net Income ($mil)640.0545.0


Balance Sheet Q1 FY18 Q1 FY17
Cash & Equiv. ($mil)6885.06116.0
Total Assets ($mil)39378.036532.0
Total Debt ($mil)6594.05092.0
Equity ($mil)11078.011973.0


Profitability Q1 FY18 Q1 FY17
Gross Profit Margin14.2314.44
EBITDA Margin4.043.89
Operating Margin2.992.84
Sales Turnover3.373.27
Return on Assets7.046.61
Return on Equity25.0420.17
Debt Q1 FY18 Q1 FY17
Current Ratio0.980.97
Debt/Capital0.370.3
Interest Expense37.029.0
Interest Coverage25.727.52


Share Data Q1 FY18 Q1 FY17
Shares outstanding (mil)439.19439.34
Div / share0.50.45
EPS1.451.24
Book value / share25.2227.25
Institutional Own % n/a n/a
Avg Daily Volume2815593.03236019.0

Valuation


BUY. COSTCO WHOLESALE CORP's P/E ratio indicates a premium compared to an average of 24.43 for the Food & Staples Retailing industry and a premium compared to the S&P 500 average of 25.51. For additional comparison, its price-to-book ratio of 7.59 indicates a significant premium versus the S&P 500 average of 3.26 and a significant premium versus the industry average of 4.55. The current price-to-sales ratio is well below the S&P 500 average, but above the industry average. Upon assessment of these and other key valuation criteria, COSTCO WHOLESALE CORP proves to trade at a premium to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
COST 30.44 Peers 24.43   COST 14.09 Peers 10.67

Premium. A higher P/E ratio than its peers can signify a more expensive stock or higher growth expectations.

COST is trading at a premium to its peers.

 

Premium. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

COST is trading at a significant premium to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
COST 25.53 Peers 20.62   COST 2.50 Peers 10.93

Premium. A higher price-to-projected earnings ratio than its peers can signify a more expensive stock or higher future growth expectations.

COST is trading at a significant premium to its peers.

 

Discount. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

COST trades at a significant discount to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
COST 7.59 Peers 4.55   COST 14.57 Peers 6.11

Premium. A higher price-to-book ratio makes a stock less attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

COST is trading at a significant premium to its peers.

 

Higher. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

COST is expected to have an earnings growth rate that significantly exceeds its peers.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
COST 0.63 Peers 0.56   COST 10.98 Peers 4.32

Premium. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

COST is trading at a premium to its industry on this measurement.

 

Higher. A sales growth rate that exceeds the industry implies that a company is gaining market share.

COST has a sales growth rate that significantly exceeds its peers.

 

 

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