Costco Stock Analysis (NASDAQ:COST)

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$167.68 $0.9 (0.54%) COST stock closing price Mar 22, 2017 (Closing)
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Costco
Updated on : Mar 22, 2017
previous close
COST 167.7 (0%)
S&P 500 2348.5 (0%)
Closing Price On: Mar 22, 2017
stock rating
RATING: ★★★★★★★★★★ (0/5)
Industry :
Retail-Discount and variety
Sector :
Retail-Wholesale
5 Quarter Revenue
Revenue Growth
2017-Q2
$billion
%
YOY GROWTH
Compared to the industry
Operating Profit
Operating Margin:
3.1%
Sector Average:
7.3%
5 Quarter Net Profit
Net Margins
2017-Q2
%
LTM Margin
Compared to the industry
Debt/Equity Ratio
Debt:
5.07B
Debt/Equity Ratio:
 0.4
Compared to the industry
Cash Flow
Operating cash flow:
$493M
Net Income:
$515M
Dividend Yield
COST dividend yield:
0.81%
PROS      CONS
Recent Growth
ROIC
ROE
Operating Margins
Net Margins
High Debt Burden
FCF Margin
PE Valuation
Rating: ★★★★★★★★★★ (0/5)
Relative Valuation
COST PS :
0.6
Industry PS :
0.7
Sector:   Retail-Wholesale.   *PE adjusted for one time items.
Other Metrics
Return on Invested Capital:
19.3%
Return on Equity:
19.8%
Free Cash Flow Margin:
-0.1%
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Costco Analysis Video

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View Costco stock analysis video. This is our COST analyst opinion covering the buy and sell arguments for COST stock.

Costco Wholesale Corporation Stock Rating (2.5/5)

Our Costco stock opinion is based on fundamentals of the company. This Costco stock analysis is based on latest Q2 earnings for 2017. The stock price analysis takes into account a company's valuation metrics.

Should you buy COST stock?

  • Costco sales grew by 5.7% year on year in 2017 Q2.
  • Costco has an attractive ROIC (Return on Invested Capital) of 19.3%
  • Costco has a good Return On Equity (ROE) of 19.8%.

Should you sell COST stock?

  • Costco had a poor average operating margin of 3.1% over the last 4 quarters.
  • Costco posted a TTM Net margin of 2%.
  • Costco is debt laden and has a high debt/equity ratio of  0.4.
  • The COST stock currently trades at a PE of 31.3, which is expensive, compared to the industry average of 18.7.
  • Costco has a negative FCF (Free Cash Flow) margin of -0.1%.

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