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Costco Wholesale

Nasdaq:COST
Snowflake Description

Flawless balance sheet with proven track record.

The Snowflake is generated from 30 checks in 5 different areas, read more below.
COST
Nasdaq
$126B
Market Cap
  1. Home
  2. US
  3. Consumer Retailing
Company description

Costco Wholesale Corporation, together with its subsidiaries, operates membership warehouses in the United States, Puerto Rico, Canada, the United Kingdom, Mexico, Japan, Korea, Australia, Spain, France, Iceland, China, and Taiwan. The last earnings update was 20 days ago. More info.


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COST Share Price and Events
7 Day Returns
1.4%
NasdaqGS:COST
1.5%
US Consumer Retailing
7.2%
US Market
1 Year Returns
17.5%
NasdaqGS:COST
10.1%
US Consumer Retailing
-10.4%
US Market
COST Shareholder Return
  7 Day 30 Day 90 Day 1 Year 3 Year 5 Year
Costco Wholesale (COST) 1.4% -7.9% -2.3% 17.5% 70.6% 87.4%
US Consumer Retailing 1.5% 1.6% -8.9% 10.1% 30.2% 22.9%
US Market 7.2% -12.6% -19.4% -10.4% 8.3% 21%
1 Year Return vs Industry and Market
  • COST outperformed the Consumer Retailing industry which returned 10.1% over the past year.
  • COST outperformed the Market in United States of America which returned -10.4% over the past year.
Price Volatility
COST
Industry
5yr Volatility vs Market
Related Companies

COST Value

 Is Costco Wholesale undervalued based on future cash flows and its price relative to the stock market?

Value is all about what a company is worth versus what price it is available for. If you went into a grocery store and all the bananas were on sale at half price, they could be considered undervalued.
INTRINSIC VALUE BASED ON FUTURE CASH FLOWS
Here we compare the current share price of Costco Wholesale to its discounted cash flow analysis.value.

The discounted cash flow value is simply looking at what the company is worth today, based on estimates of how much money it is expected to make in the future.
Raw Data

Below are the data sources, inputs and calculation used to determine the intrinsic value for Costco Wholesale.

NasdaqGS:COST Discounted Cash Flow Data Sources
Data Point Source Value
Valuation Model 2 Stage Free Cash Flow to Equity
Levered Free Cash Flow Average of 24 Analyst Estimates (S&P Global) See below
Discount Rate (Cost of Equity) See below 6.1%
Perpetual Growth Rate 10-Year US Government Bond Rate 1.7%

An important part of a discounted cash flow is the discount rate, below we explain how it has been calculated.

Calculation of Discount Rate/ Cost of Equity for NasdaqGS:COST
Data Point Calculation/ Source Result
Risk-Free Rate 10-Year US Govt Bond Rate 1.7%
Equity Risk Premium S&P Global 5.4%
Consumer Retailing Unlevered Beta Simply Wall St/ S&P Global 0.49
Re-levered Beta = Unlevered beta (1 + (1- tax rate) (Debt/Equity))
= 0.488 (1 + (1- 21%) (6.97%))
0.675
Levered Beta Levered Beta limited to 0.8 to 2.0
(practical range for a stable firm)
0.8
Discount Rate/ Cost of Equity = Cost of Equity = Risk Free Rate + (Levered Beta * Equity Risk Premium)
= 1.74% + (0.8 * 5.44%)
6.09%

Discounted Cash Flow Calculation for NasdaqGS:COST using 2 Stage Free Cash Flow to Equity Model

The calculations below outline how an intrinsic value for Costco Wholesale is arrived at by discounting future cash flows to their present value using the 2 stage method. We try to start with analysts estimates of free cash flow, however if these are not available we use the most recent financial results. In the 1st stage we continue to grow the free cash flow over a 10 year period, with the growth rate trending towards the perpetual growth rate used in the 2nd stage. The 2nd stage assumes the company grows at a stable rate into perpetuity.

Note: Free cash flow to equity valuations ignore the company's cash or debt.

NasdaqGS:COST DCF 1st Stage: Next 10 year cash flow forecast
Levered FCF (USD, Millions) Source Present Value
Discounted (@ 6.09%)
2020 3,149.42 Analyst x10 2,968.57
2021 3,460.37 Analyst x10 3,074.38
2022 4,269.28 Analyst x4 3,575.25
2023 4,998.07 Analyst x3 3,945.22
2024 5,763.10 Analyst x3 4,287.88
2025 6,319.76 Est @ 9.66% 4,432.05
2026 6,780.05 Est @ 7.28% 4,481.82
2027 7,161.12 Est @ 5.62% 4,461.90
2028 7,480.23 Est @ 4.46% 4,393.10
2029 7,752.62 Est @ 3.64% 4,291.63
Present value of next 10 years cash flows $39,911.00
NasdaqGS:COST DCF 2nd Stage: Terminal Value
Calculation Result
Terminal Value = FCF2029 × (1 + g) ÷ (Discount Rate – g)
= $7,752.62 × (1 + 1.74%) ÷ (6.09% – 1.74%)
$181,238.76
Present Value of Terminal Value = Terminal Value ÷ (1 + r)10
= $181,238.76 ÷ (1 + 6.09%)10
$100,328.59
NasdaqGS:COST Total Equity Value
Calculation Result
Total Equity Value = Present value of next 10 years cash flows + Terminal Value
= $39,911.00 + $100,328.59
$140,239.59
Equity Value per Share
(USD)
= Total value / Shares Outstanding
= $140,239.59 / 441.58
$317.59
NasdaqGS:COST Discount to Share Price
Calculation Result
Value per share (USD) From above. $317.59
Current discount Discount to share price of $284.83
= -1 x ($284.83 - $317.59) / $317.59
10.3%

Learn more about our DCF calculations in Simply Wall St’s analysis model .

Current Discount
Amount off the current price Costco Wholesale is available for.
Intrinsic value
10%
Share price is $284.83 vs Future cash flow value of $317.59
Current Discount Checks
For Costco Wholesale to be considered undervalued it must be available for at least 20% below the current price. Less than 40% is even better.
  • Costco Wholesale's share price is below the future cash flow value, but not at a moderate discount (< 20%).
  • Costco Wholesale's share price is below the future cash flow value, but not at a substantial discount (< 40%).
PRICE RELATIVE TO MARKET
We can also value a company based on what the stock market is willing to pay for it. This is similar to the price of fruit (e.g. Mangoes or Avocados) increasing when they are out of season, or how much your home is worth.

The amount the stock market is willing to pay for Costco Wholesale's earnings, growth and assets is considered below, and whether this is a fair price.
Price based on past earnings
Are Costco Wholesale's earnings available for a low price, and how does this compare to other companies in the same industry?
Raw Data
NasdaqGS:COST PE (Price to Earnings) Ratio Data Sources
Data Point Source Value
Earnings Per Share * Company Filings (2020-02-16) in USD $8.57
NasdaqGS:COST Share Price ** NasdaqGS (2020-03-31) in USD $284.83
United States of America Consumer Retailing Industry PE Ratio Median Figure of 22 Publicly-Listed Consumer Retailing Companies 15.68x
United States of America Market PE Ratio Median Figure of 2,938 Publicly-Listed Companies 13.11x

* Trailing twelve months (TTM) annual GAAP earnings per share excluding extraordinary items.

** Primary Listing of Costco Wholesale.

NasdaqGS:COST PE (Price to Earnings) Ratio Calculation
Calculation Outcome
PE Ratio

= NasdaqGS:COST Share Price ÷ EPS (both in USD)

= 284.83 ÷ 8.57

33.24x

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Costco Wholesale is overvalued based on earnings compared to the US Consumer Retailing industry average.
  • Costco Wholesale is overvalued based on earnings compared to the United States of America market.
Price based on expected Growth
Does Costco Wholesale's expected growth come at a high price?
Raw Data
NasdaqGS:COST PEG (Price to Earnings to Growth) Ratio Data Sources
Data Point Source Value
PE Ratio See PE Ratio Section 33.24x
Net Income Annual Growth Rate See Future Growth Section.
Line of Best Fit* through Consensus Estimate Earnings of 24 Analysts
8%per year
United States of America Consumer Retailing Industry PEG Ratio Median Figure of 13 Publicly-Listed Consumer Retailing Companies 2.16x
United States of America Market PEG Ratio Median Figure of 2,007 Publicly-Listed Companies 1.01x

*Line of best fit is calculated by linear regression .

NasdaqGS:COST PEG (Price to Earnings to Growth) Ratio Calculation
Calculation Outcome
PEG Ratio

= PE Ratio ÷ Net Income Annual Growth Rate

= 33.24x ÷ 8%

4.15x

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Costco Wholesale is poor value based on expected growth next year.
Price based on value of assets
What value do investors place on Costco Wholesale's assets?
Raw Data
NasdaqGS:COST PB (Price to Book) Ratio Data Sources
Data Point Source Value
Book Value per Share Company Filings (2020-02-16) in USD $37.62
NasdaqGS:COST Share Price * NasdaqGS (2020-03-31) in USD $284.83
United States of America Consumer Retailing Industry PB Ratio Median Figure of 29 Publicly-Listed Consumer Retailing Companies 1.12x
United States of America Market PB Ratio Median Figure of 5,134 Publicly-Listed Companies 1.27x
NasdaqGS:COST PB (Price to Book) Ratio Calculation
Calculation Outcome
PB Ratio

= NasdaqGS:COST Share Price ÷ Book Value per Share (both in USD)

= 284.83 ÷ 37.62

7.57x

* Primary Listing of Costco Wholesale.

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Costco Wholesale is overvalued based on assets compared to the US Consumer Retailing industry average.
X
Value checks
We assess Costco Wholesale's value by looking at:
  1. Is the discounted cash flow value less than 20%, or 40% of the share price? (2 checks) ( Click here or on bar chart for details of DCF calculation. )
  2. Is the PE ratio less than the market average, and/ or less than the Consumer Retailing industry average (and greater than 0)? (2 checks)
  3. Is the PEG ratio within a reasonable range (0 to 1)? (1 check)
  4. Is the PB ratio less than the Consumer Retailing industry average (and greater than 0)? (1 check)
  5. Costco Wholesale has a total score of 0/6, see the detailed checks below.

    Note: We use GAAP Earnings per Share in all our calculations including PE and PEG Ratio.

    Full details on the Value part of the Simply Wall St company analysis model.

COST Future Performance

 How is Costco Wholesale expected to perform in the next 1 to 3 years based on estimates from 24 analysts?

The future performance of a company is measured in the same way as past performance, by looking at estimated growth and how much profit it is expected to make.

Future estimates come from professional analysts. Just like forecasting the weather, they don’t always get it right!
Annual Growth Rate
8%
Expected annual growth in earnings.
Earnings growth vs Low Risk Savings
Is Costco Wholesale expected to grow at an attractive rate?
  • Costco Wholesale's earnings growth is expected to exceed the low risk savings rate of 1.7%.
Growth vs Market Checks
  • Costco Wholesale's earnings growth is positive but not above the United States of America market average.
  • Costco Wholesale's revenue growth is positive but not above the United States of America market average.
Annual Growth Rates Comparison
Raw Data
NasdaqGS:COST Future Growth Rates Data Sources
Data Point Source Value (per year)
NasdaqGS:COST Future Earnings Growth Rate Line of Best Fit* through Consensus Estimate Earnings of 24 Analysts 8%
NasdaqGS:COST Future Revenue Growth Rate Line of Best Fit* through Consensus Estimate Revenue of 24 Analysts 6.6%
United States of America Consumer Retailing Industry Earnings Growth Rate Market Cap Weighted Average 4.9%
United States of America Consumer Retailing Industry Revenue Growth Rate Market Cap Weighted Average 3.8%
United States of America Market Earnings Growth Rate Market Cap Weighted Average 12.2%
United States of America Market Revenue Growth Rate Market Cap Weighted Average 7.2%

*Line of best fit is calculated by linear regression .

Industry and Market average data is calculated daily.

Learn more about our growth rate calculations in Simply Wall St’s analysis model.

Analysts growth expectations
Raw Data
NasdaqGS:COST Analysts Growth Expectations Data Sources
Data Point Source Value
Past Financials Company Filings (1 month ago) See Below
Future Estimates Average of up to 24 Analyst Estimates (S&P Global) See Below
All numbers in USD Millions and using Trailing twelve months (TTM) annual period rather than quarterly.
NasdaqGS:COST Future Estimates Data
Date (Data in USD Millions) Revenue Cash Flow Net Income * Avg. No. Analysts
2024-08-31 214,280 9,645 5,469 4
2023-08-31 201,542 8,702 5,003 4
2022-08-31 187,160 7,718 4,476 13
2021-08-31 175,487 6,661 4,119 24
2020-08-31 164,758 6,452 3,920 24
2020-04-01
NasdaqGS:COST Past Financials Data
Date (Data in USD Millions) Revenue Cash Flow Net Income *
2020-02-16 158,350 7,119 3,778
2019-11-24 154,674 6,281 3,736
2019-09-01 152,703 6,356 3,659
2019-05-12 149,616 5,617 3,605
2019-02-17 147,237 5,617 3,449
2018-11-25 144,836 5,945 3,261
2018-09-02 141,576 5,774 3,134
2018-05-13 139,465 6,054 3,010
2018-02-18 135,964 5,555 2,960
2017-11-26 132,735 5,939 2,774
2017-09-03 129,025 6,726 2,679
2017-05-07 123,285 4,723 2,539

*GAAP earnings excluding extraordinary items.

Super high growth metrics
High Growth Checks
  • Costco Wholesale's earnings are expected to grow by 8% yearly, however this is not considered high growth (20% yearly).
  • Costco Wholesale's revenue is expected to grow by 6.6% yearly, however this is not considered high growth (20% yearly).
Past and Future Earnings per Share
The accuracy of the analysts who estimate the future performance data can be gauged below. We look back 3 years and see if they were any good at predicting what actually occurred. We also show the highest and lowest estimates looking forward to see if there is a wide range.
Raw Data
NasdaqGS:COST Past and Future Earnings per Share
Data Point Source Value
Past Financials Company Filings (1 month ago) See Below
Future Estimates Average of up to 24 Analyst Estimates (S&P Global) See Below

All data from Costco Wholesale Company Filings, last reported 1 month ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

NasdaqGS:COST Future Estimates Data
Date (Data in USD Millions) EPS * EPS High Estimate EPS Low Estimate Avg. No. Analysts
2024-08-31 13.67 16.18 12.11 3.00
2023-08-31 12.12 13.72 11.17 3.00
2022-08-31 10.32 11.83 9.41 8.00
2021-08-31 9.41 10.27 8.58 17.00
2020-08-31 8.87 9.23 8.62 14.00
2020-04-01
NasdaqGS:COST Past Financials Data
Date (Data in USD Millions) EPS *
2020-02-16 8.57
2019-11-24 8.48
2019-09-01 8.32
2019-05-12 8.20
2019-02-17 7.85
2018-11-25 7.43
2018-09-02 7.15
2018-05-13 6.87
2018-02-18 6.75
2017-11-26 6.33
2017-09-03 6.11
2017-05-07 5.79

*GAAP earnings excluding extraordinary items.

Performance in 3 years
In the same way as past performance we look at the future estimated return (profit) compared to the available funds. We do this looking forward 3 years.
  • Costco Wholesale is not expected to efficiently use shareholders’ funds in the future (Return on Equity less than 20%).
X
Future performance checks
We assess Costco Wholesale's future performance by looking at:
  1. Is the annual earnings growth rate expected to beat the low risk savings rate, plus a premium to keep pace with inflation?
  2. Is the annual earnings growth rate expected to beat the average growth rate in earnings of the United States of America market? (1 check)
  3. Is the annual revenue growth rate expected to beat the average growth rate in revenue of the United States of America market? (1 check)
  4. Is the annual earnings growth rate expected to be above 20%? (1 check)
  5. Is the annual revenue growth rate expected to be above 20%? (1 check)
  6. Is the Return on Equity in 3 years expected to be over 20%? (1 check)
Some of the above checks will fail if the company is expected to be loss making in the relevant year.
Costco Wholesale has a total score of 1/6, see the detailed checks below.

Note 1: We use GAAP Net Income Excluding Exceptional Items for our Earnings in all our calculations.

Full details on the Future part of the Simply Wall St company analysis model.

COST Past Performance

  How has Costco Wholesale performed over the past 5 years?

The past performance of a company can be measured by how much growth it has experienced and how much profit it makes relative to the funds and assets it has available.
Past earnings growth
Below we compare Costco Wholesale's growth in the last year to its industry (Consumer Retailing).
Past Earnings growth analysis
We also check if the company has grown in the past 5 years, and whether it has maintained that growth in the year.
  • Costco Wholesale's year on year earnings growth rate has been positive over the past 5 years.
  • Costco Wholesale's 1-year earnings growth is less than its 5-year average (9.6% vs 11.8%)
  • Costco Wholesale's earnings growth has exceeded the US Consumer Retailing industry average in the past year (9.6% vs -0.6%).
Earnings and Revenue History
Costco Wholesale's revenue and profit over the past 5 years is shown below, any years where they have experienced a loss will show up in red.
Raw Data

All data from Costco Wholesale Company Filings, last reported 1 month ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

NasdaqGS:COST Past Revenue, Cash Flow and Net Income Data
Date (Data in USD Millions) Revenue Net Income * G+A Expenses R&D Expenses
2020-02-16 158,350.00 3,778.00 15,606.00
2019-11-24 154,674.00 3,736.00 15,329.00
2019-09-01 152,703.00 3,659.00 15,080.00
2019-05-12 149,616.00 3,605.00 14,649.00
2019-02-17 147,237.00 3,449.00 14,427.00
2018-11-25 144,836.00 3,261.00 14,200.00
2018-09-02 141,576.00 3,134.00 13,944.00
2018-05-13 139,465.00 3,010.00 13,803.00
2018-02-18 135,964.00 2,960.00 13,562.00
2017-11-26 132,735.00 2,774.00 13,311.00
2017-09-03 129,025.00 2,679.00 13,032.00
2017-05-07 123,285.00 2,539.00 12,599.00
2017-02-12 121,194.00 2,384.00 12,426.00
2016-11-20 119,598.00 2,415.00 12,276.00
2016-08-28 118,719.00 2,350.00 12,146.00
2016-05-08 117,937.00 2,338.00 11,952.00
2016-02-14 117,269.00 2,309.00 11,796.00
2015-11-22 116,553.00 2,361.00 11,631.00
2015-08-30 116,199.00 2,377.00 11,510.00
2015-05-10 115,944.00 2,307.00 11,379.00
2015-02-15 115,637.00 2,264.00 11,289.00
2014-11-23 114,489.00 2,129.00 11,148.00
2014-08-31 112,640.00 2,058.00 10,962.00
2014-05-11 109,604.00 1,978.00 10,682.00
2014-02-16 107,893.00 1,964.00 10,502.00
2013-11-24 106,458.00 2,048.00 10,330.00
2013-09-01 105,156.00 2,039.00 10,155.00
2013-05-12 104,887.00 2,031.00 10,099.00

*GAAP earnings excluding extraordinary items.

Performance last year
We want to ensure a company is making the most of what it has available. This is done by comparing the return (profit) to a company's available funds, assets and capital.
  • Costco Wholesale has efficiently used shareholders’ funds last year (Return on Equity greater than 20%).
  • Costco Wholesale used its assets more efficiently than the US Consumer Retailing industry average last year based on Return on Assets.
  • Costco Wholesale's use of capital deteriorated last year versus 3 years ago (Return on Capital Employed).
X
Past performance checks
We assess Costco Wholesale's performance over the past 5 years by checking for:
  1. Has earnings increased in past 5 years? (1 check)
  2. Has the earnings growth in the last year exceeded that of the Consumer Retailing industry? (1 check)
  3. Is the recent earnings growth over the last year higher than the average annual growth over the past 5 years? (1 check)
  4. Is the Return on Equity (ROE) higher than 20%? (1 check)
  5. Is the Return on Assets (ROA) above industry average? (1 check)
  6. Has the Return on Capital Employed (ROCE) increased from 3 years ago? (1 check)
The above checks will fail if the company has reported a loss in the most recent earnings report. Some checks require at least 3 or 5 years worth of data.
Costco Wholesale has a total score of 4/6, see the detailed checks below.

Note: We use GAAP Net Income excluding extraordinary items in all our calculations.

Full details on the Past part of the Simply Wall St company analysis model.

COST Health

 How is Costco Wholesale's financial health and their level of debt?

A company's financial position is much like your own financial position, it includes everything you own (assets) and owe (liabilities).

The boxes below represent the relative size of what makes up Costco Wholesale's finances.

The net worth of a company is the difference between its assets and liabilities.
Net Worth
  • Costco Wholesale is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.
  • Costco Wholesale's cash and other short term assets cover its long term commitments.
Balance sheet
This treemap shows a more detailed breakdown of Costco Wholesale's finances. If any of them are yellow this indicates they may be out of proportion and red means they relate to one of the checks below.
Assets
Liabilities and shares
The 'shares' portion represents any funds contributed by the owners (shareholders) and any profits.
  • High level of physical assets or inventory.
  • Debt is covered by short term assets, assets are 4.2x debt.
Historical Debt
Nearly all companies have debt. Debt in itself isn’t bad, however if the debt is too high, or the company can’t afford to pay the interest on its debts this may have impacts in the future.

The graphic below shows equity (available funds) and debt, we ideally want to see the red area (debt) decreasing.

If there is any debt we look at the companies capability to repay it, and whether the level has increased over the past 5 years.
Raw Data

All data from Costco Wholesale Company Filings, last reported 1 month ago.

NasdaqGS:COST Past Debt and Equity Data
Date (Data in USD Millions) Total Equity Total Debt Cash & Short Term Investments
2020-02-16 16,999.00 5,599.00 8,715.00
2019-11-24 16,224.00 6,807.00 10,020.00
2019-09-01 15,584.00 6,823.00 9,444.00
2019-05-12 14,820.00 6,498.00 8,167.00
2019-02-17 14,183.00 6,492.00 7,122.00
2018-11-25 13,479.00 6,480.00 7,953.00
2018-09-02 13,103.00 6,577.00 7,259.00
2018-05-13 12,447.00 6,492.00 7,044.00
2018-02-18 12,053.00 6,505.00 5,830.00
2017-11-26 11,356.00 6,478.00 6,885.00
2017-09-03 11,079.00 6,659.00 5,779.00
2017-05-07 10,185.00 3,979.00 5,725.00
2017-02-12 12,712.00 5,072.00 5,965.00
2016-11-20 12,231.00 5,092.00 6,116.00
2016-08-28 12,332.00 5,161.00 4,729.00
2016-05-08 11,748.00 5,114.00 6,021.00
2016-02-14 11,234.00 4,975.00 4,855.00
2015-11-22 11,080.00 6,126.00 6,283.00
2015-08-30 10,843.00 6,135.00 6,419.00
2015-05-10 10,814.00 6,026.00 6,805.00
2015-02-15 10,425.00 5,030.00 7,453.00
2014-11-23 12,570.00 5,034.00 7,619.00
2014-08-31 12,515.00 5,093.00 7,315.00
2014-05-11 12,021.00 4,985.00 7,275.00
2014-02-16 11,709.00 4,985.00 6,482.00
2013-11-24 11,409.00 4,987.00 6,439.00
2013-09-01 11,012.00 4,998.00 6,124.00
2013-05-12 10,647.00 4,941.00 6,510.00
  • Costco Wholesale's level of debt (32.9%) compared to net worth is satisfactory (less than 40%).
  • The level of debt compared to net worth has been reduced over the past 5 years (48.4% vs 32.9% today).
  • Debt is well covered by operating cash flow (127.1%, greater than 20% of total debt).
  • Interest payments on debt are well covered by earnings (EBIT is 272.9x coverage).
X
Financial health checks
We assess Costco Wholesale's financial health by checking for:
  1. Are short term assets greater than short term liabilities? (1 check)
  2. Are short term assets greater than long term liabilities? (1 check)
  3. Has the debt to equity ratio increased in the past 5 years? (1 check)
  4. Is the debt to equity ratio over 40%? (1 check)
  5. Is the debt covered by operating cash flow? (1 check)
  6. Are earnings greater than 5x the interest on debt (if company pays interest at all)? (1 check)
  7. Costco Wholesale has a total score of 6/6, see the detailed checks below.
For companies that are loss making and have been so on average in the past we replace the last 2 checks with:
  1. Does cash and short term investments cover stable operating expenses (recurring G&A and R&D) for more than 3 years? (1 check)
  2. Does cash and short term investments cover growing operating expenses (recurring G&A and R&D) for more than 3 years? (1 check)


Full details on the Health part of the Simply Wall St company analysis model.

COST Dividends

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

Dividends are regular cash payments to you from the company, similar to a bank paying you interest on a savings account.
Annual Dividend Income
Dividend payments
0.91%
Current annual income from Costco Wholesale dividends. Estimated to be 0.98% next year.
If you bought $2,000 of Costco Wholesale shares you are expected to receive $18 in your first year as a dividend.
Dividend Amount
Here we look how much dividend is being paid, if any. Is it above what you can get in a savings account? It is up there with the best dividend paying companies?
  • Costco Wholesale's pays a lower dividend yield than the bottom 25% of dividend payers in United States of America (1.95%).
  • Costco Wholesale's dividend is below the markets top 25% of dividend payers in United States of America (5.4%).
Annualized Historical and Future Dividends
It is important to see if the dividend for a company is stable, and not wildly increasing/decreasing each year. This graph shows you the historical rate to count toward your assessment of the stock.

We also check to see if the dividend has increased in the past 10 years.
Raw Data
NasdaqGS:COST Annualized Past and Future Dividends
Data Point Source Value
Past Annualized Dividend Yield S&P Global Market Data See Below
Past Dividends per Share Company Filings/ Annualized Dividend Payments See Below
Future Dividends per Share Estimates Average of up to 24 Analyst Estimates (S&P Global) See Below
United States of America Consumer Retailing Industry Average Dividend Yield Market Cap Weighted Average of 13 Stocks 1.9%
United States of America Market Average Dividend Yield Market Cap Weighted Average of 1946 Stocks 2.9%
United States of America Minimum Threshold Dividend Yield 10th Percentile 1.1%
United States of America Bottom 25% Dividend Yield 25th Percentile 1.9%
United States of America Top 25% Dividend Yield 75th Percentile 5.4%

Industry and Market average data is calculated daily.

Note all dividend per share amounts are annualized and not quarterly or other period.

NasdaqGS:COST Future Dividends Estimate Data
Date (Data in $) Dividend per Share (annual) Avg. No. Analysts
2024-08-31 3.04 2.00
2023-08-31 2.91 2.00
2022-08-31 2.87 8.00
2021-08-31 2.80 13.00
2020-08-31 2.63 11.00
2020-04-01
NasdaqGS:COST Past Annualized Dividends Data
Date (Data in $) Dividend per share (annual) Avg. Yield (%)
2020-01-23 2.600 0.855
2019-10-18 2.600 0.871
2019-08-13 2.600 0.900
2019-04-26 2.600 0.999
2019-01-24 2.280 1.002
2018-10-24 2.280 1.047
2018-08-17 2.280 0.985
2018-04-24 2.280 1.101
2018-01-30 2.000 1.066
2017-10-30 2.000 1.099
2017-07-31 2.000 1.255
2017-04-25 2.000 1.201
2017-01-27 1.800 1.062
2016-10-12 1.800 1.161
2016-07-25 1.800 1.133
2016-04-14 1.800 1.170
2016-01-29 1.600 1.056
2015-10-29 1.600 1.012
2015-07-27 1.600 1.098
2015-04-17 1.600 1.124
2015-01-29 1.420 0.952
2014-10-28 1.420 1.014
2014-06-23 1.420 1.165
2014-04-29 1.420 1.230
2014-01-30 1.240 1.091
2013-10-29 1.240 1.040
2013-07-22 1.240 1.071
2013-04-30 1.240 1.110
2013-01-24 1.100 1.060
2012-10-31 1.100 1.109
2012-07-23 1.100 1.123
2012-05-09 1.100 1.231
2012-01-26 0.960 1.107
2011-10-25 0.960 1.154
2011-07-18 0.960 1.207
2011-04-26 0.960 1.190
2011-01-27 0.820 1.110
2010-10-07 0.820 1.206
2010-07-20 0.820 1.401
2010-04-22 0.820 1.431
2010-01-28 0.720 1.198
2009-10-08 0.720 1.219
2009-07-27 0.720 1.367
2009-04-28 0.720 1.535

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Costco Wholesale is not paying a notable dividend for United States of America, therefore no need to check if the payments are stable.
  • Costco Wholesale is not paying a notable dividend for United States of America, therefore no need to check if the payments are increasing.
Current Payout to shareholders
What portion of Costco Wholesale's earnings are paid to the shareholders as a dividend.
  • No need to calculate the sustainability of Costco Wholesale's dividends as it is not paying a notable one for United States of America.
Future Payout to shareholders
  • No need to calculate the sustainability of Costco Wholesale's dividends in 3 years as they are not expected to pay a notable one for United States of America.
X
Income/ dividend checks
We assess Costco Wholesale's dividend by checking for:
  1. Firstly is the company paying a notable dividend (greater than 1.1%) - if not then the rest of the checks are ignored.
  2. Is current dividend yield above the bottom 25% of dividend payers? (1 check)
  3. Is current dividend yield above the top 25% of dividend payers? (1 check)
  4. Have they paid a dividend for 10 years, and during this period has the dividend been volatile (drop of more than 25%)? (1 check)
  5. If they have paid a dividend for 10 years has it increased in this time? (1 check)
  6. How sustainable is the dividend, can Costco Wholesale afford to pay it from its earnings today and in 3 years (Payout ratio less than 90%)? (2 checks)
  7. Costco Wholesale has a total score of 0/6, see the detailed checks below.


Full details on the Dividends part of the Simply Wall St company analysis model.

COST Management

 What is the CEO of Costco Wholesale's salary, the management and board of directors tenure and is there insider trading?

Management is one of the most important areas of a company. We look at unreasonable CEO compensation, how long the team and board of directors have been around for and insider trading.
CEO
W. Jelinek
COMPENSATION $8,016,200
AGE 67
TENURE AS CEO 8.2 years
CEO Bio

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 Merchandising since 2004. Mr. Jelinek served as an Executive Vice President and Chief Operating Officer of Merchandising of Costco Wholesale Corp. since February 2004 until February 2010. He served as Chief Operating Officer of Costco Wholesale Corporation from February 2010 to December 2011. Mr. Jelinek served as Chief Operating Officer of Northern Division at Costco Wholesale Corp. since September 1995. He served as Senior Vice President of Operations - Northwest Region at Costco Wholesale Corp. since September 1994. From May 1986 to September 1994, he served as Vice President of Regional Operations and Manager of Los Angeles Region. He joined Costco Wholesale Corporation in April 1984. Mr. Jelinek has been a Director at Costco Wholesale Corporation since February 2010. He has been a Director of Costco Wholesale Australia, Pty Limited since June 5, 2015.

CEO Compensation
  • W.'s compensation has been consistent with company performance over the past year, both up more than 20%.
  • W.'s remuneration is lower than average for companies of similar size in United States of America.
Management Team Tenure

Average tenure and age of the Costco Wholesale management team in years:

15.5
Average Tenure
66.5
Average Age
  • The average tenure for the Costco Wholesale management team is over 5 years, this suggests they are a seasoned and experienced team.
Management Team

W. Jelinek

TITLE
President
COMPENSATION
$8M
AGE
67
TENURE
8.2 yrs

Richard Galanti

TITLE
Executive VP
COMPENSATION
$4M
AGE
63
TENURE
26.4 yrs

Paul Moulton

TITLE
Executive VP & Chief Information Officer
COMPENSATION
$4M
AGE
68

Joseph Portera

TITLE
Executive VP
COMPENSATION
$4M
AGE
67
TENURE
25.6 yrs

James Murphy

TITLE
Executive VP & COO of International Division
COMPENSATION
$4M
AGE
66
TENURE
15.5 yrs

Pat Callans

TITLE
Executive Vice President of Administration
AGE
57
TENURE
1.2 yrs

Bob Nelson

TITLE
Senior Vice President of Financial Planning & Investor Relations

John Sullivan

TITLE
Senior VP

Richard Chavez

TITLE
Senior Vice President of Costco Wholesale Industries & Business Development

Paul Latham

TITLE
Senior Vice President of Membership
Board of Directors Tenure

Average tenure and age of the Costco Wholesale board of directors in years:

7.3
Average Tenure
64
Average Age
  • The tenure for the Costco Wholesale board of directors is about average.
Board of Directors

Tony James

TITLE
Independent Chairman of the Board
COMPENSATION
$298K
AGE
68
TENURE
2.6 yrs

W. Jelinek

TITLE
President
COMPENSATION
$8M
AGE
67
TENURE
10.1 yrs

Richard Galanti

TITLE
Executive VP
COMPENSATION
$4M
AGE
63
TENURE
25.2 yrs

Richard Libenson

TITLE
Consultant and Director Emeritus
COMPENSATION
$689K
AGE
77
TENURE
3.2 yrs

Charlie Munger

TITLE
Independent Director
COMPENSATION
$308K
AGE
95
TENURE
23.2 yrs

Jeff Raikes

TITLE
Independent Director
COMPENSATION
$305K
AGE
61
TENURE
11.3 yrs

John Stanton

TITLE
Independent Director
COMPENSATION
$300K
AGE
64
TENURE
4.4 yrs

Sue Decker

TITLE
Independent Director
COMPENSATION
$308K
AGE
56
TENURE
15.4 yrs

Maggie Wilderotter

TITLE
Independent Director
COMPENSATION
$305K
AGE
64
TENURE
4.4 yrs

Ken Denman

TITLE
Independent Director
COMPENSATION
$313K
AGE
60
TENURE
3 yrs
Who owns this company?
Recent Insider Trading
  • Costco Wholesale individual insiders have only sold shares in the past 3 months.
Recent Insider Transactions
Announced Type Name Entity Role Start End Shares Max Price ($) Value ($)
20. Mar 20 Sell Susan Decker Individual 20. Mar 20 20. Mar 20 -1,000 $297.00 $-297,000
19. Mar 20 Sell Richard Galanti Individual 19. Mar 20 19. Mar 20 -1,448 $306.51 $-443,833
15. Jan 20 Sell Susan Decker Individual 14. Jan 20 14. Jan 20 -3,850 $300.41 $-1,156,567
18. Dec 19 Sell Ron Vachris Individual 17. Dec 19 17. Dec 19 -6,000 $295.22 $-1,771,295
17. Dec 19 Sell Patrick Callans Individual 16. Dec 19 16. Dec 19 -2,000 $293.99 $-587,987
18. Nov 19 Sell Susan Decker Individual 15. Nov 19 15. Nov 19 -1,703 $303.01 $-516,032
13. Nov 19 Sell Richard Galanti Individual 13. Nov 19 13. Nov 19 -1,984 $302.80 $-600,763
08. Nov 19 Sell Russell Miller Individual 08. Nov 19 08. Nov 19 -1,000 $302.83 $-302,833
08. Nov 19 Sell Paul Moulton Individual 08. Nov 19 08. Nov 19 -3,978 $303.05 $-1,205,525
31. Oct 19 Sell Joseph Portera Individual 30. Oct 19 30. Oct 19 -14,095 $299.52 $-4,221,734
31. Oct 19 Sell Richard Libenson Individual 30. Oct 19 30. Oct 19 -1,703 $298.25 $-507,914
24. Oct 19 Sell Daniel Hines Individual 23. Oct 19 23. Oct 19 -5,000 $298.46 $-1,492,284
18. Oct 19 Sell Susan Decker Individual 17. Oct 19 18. Oct 19 -2,236 $303.05 $-677,065
15. Oct 19 Sell Susan Decker Individual 11. Oct 19 11. Oct 19 -333 $297.50 $-99,068
11. Oct 19 Sell Paul Moulton Individual 11. Oct 19 11. Oct 19 -5,976 $298.06 $-1,781,186
05. Jul 19 Sell Susan Decker Individual 03. Jul 19 03. Jul 19 -1,646 $268.25 $-441,540
24. Jun 19 Sell Ron Vachris Individual 24. Jun 19 24. Jun 19 -3,700 $267.25 $-988,823
20. Jun 19 Sell James Murphy Individual 20. Jun 19 20. Jun 19 -10,000 $265.85 $-2,658,528
20. Jun 19 Sell Richard Galanti Individual 20. Jun 19 20. Jun 19 -3,000 $266.39 $-799,178
10. Jun 19 Sell James Klauer Individual 07. Jun 19 07. Jun 19 -5,000 $255.80 $-1,277,669
10. Jun 19 Sell Susan Decker Individual 07. Jun 19 07. Jun 19 -2,790 $256.00 $-710,393
10. Jun 19 Sell Daniel Hines Individual 07. Jun 19 07. Jun 19 -6,000 $252.65 $-1,515,626
10. Jun 19 Sell Patrick Callans Individual 07. Jun 19 07. Jun 19 -2,000 $252.15 $-504,308
X
Management checks
We assess Costco Wholesale's management by checking for:
  1. Is the CEO's compensation unreasonable compared to market cap? (1 check)
  2. Has the CEO's compensation increased more than 20% whilst the EPS is down more then 20%? (1 check)
  3. Is the average tenure of the management team less than 2 years? (1 check)
  4. Is the average tenure of the board of directors team less than 3 years? (1 check)
  5. Costco Wholesale has a total score of 0/6, this is not included on the snowflake, see the detailed checks below.


Note: We use the top 6 management executives and board members in our calculations.

Note 2: Insider trading include any internal stakeholders and these transactions .

Full details on the Management part of the Simply Wall St company analysis model.

COST News

Simply Wall St News

Boasting A 25% Return On Equity, Is Costco Wholesale Corporation (NASDAQ:COST) A Top Quality Stock?

The formula for ROE is: Return on Equity = Net Profit ÷ Shareholders' Equity Or for Costco Wholesale: 25% = US$3.6b ÷ US$15b (Based on the trailing twelve months to May 2019.) Most know that net profit is the total earnings after all expenses, but the concept of shareholders' equity is a little more complicated. … Does Costco Wholesale Have A Good Return On Equity? … Costco Wholesale's Debt And Its 25% ROE While Costco Wholesale does have some debt, with debt to equity of just 0.41, we wouldn't say debt is excessive.

Simply Wall St -

Be Sure To Check Out Costco Wholesale Corporation (NASDAQ:COST) Before It Goes Ex-Dividend

Costco Wholesale's upcoming dividend is US$0.65 a share, following on from the last 12 months, when the company distributed a total of US$2.60 per share to shareholders. … View our latest analysis for Costco Wholesale If a company pays out more in dividends than it earned, then the dividend might become unsustainable - hardly an ideal situation. … NasdaqGS:COST Historical Dividend Yield, August 25th 2019 Have Earnings And Dividends Been Growing?

Simply Wall St -

Here's What Costco Wholesale Corporation's (NASDAQ:COST) P/E Is Telling Us

Costco Wholesale has a price to earnings ratio of 33.41, based on the last twelve months. … View our latest analysis for Costco Wholesale How Do You Calculate Costco Wholesale's P/E Ratio? … The formula for P/E is: Price to Earnings Ratio = Price per Share ÷ Earnings per Share (EPS) Or for Costco Wholesale: P/E of 33.41 = $274.1 ÷ $8.2 (Based on the trailing twelve months to May 2019.) Is A High Price-to-Earnings Ratio Good?

Simply Wall St -

Are Costco Wholesale Corporation (NASDAQ:COST) Investors Paying Above The Intrinsic Value?

We assume companies with shrinking free cash flow will slow their rate of shrinkage, and that companies with growing free cash flow will see their growth rate slow, over this period. … A DCF is all about the idea that a dollar in the future is less valuable than a dollar today, so we need to discount the sum of these future cash flows to arrive at a present value estimate: 10-year free cash flow (FCF) forecast 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 Levered FCF ($, Millions) $2.9b $3.5b $3.7b $4.4b $4.9b $5.2b $5.6b $5.9b $6.1b $6.4b Growth Rate Estimate Source Analyst x11 Analyst x6 Analyst x3 Analyst x3 Est @ 10.07% Est @ 7.87% Est @ 6.33% Est @ 5.25% Est @ 4.49% Est @ 3.96% Present Value ($, Millions) Discounted @ 7.5% $2.7k $3.0k $3.0k $3.3k $3.4k $3.4k $3.4k $3.3k $3.2k $3.1k ("Est" = FCF growth rate estimated by Simply Wall St) Present Value of 10-year Cash Flow (PVCF)= $31.7b We now need to calculate the Terminal Value, which accounts for all the future cash flows after this ten year period. … NasdaqGS:COST Intrinsic value, August 12th 2019 The assumptions Now the most important inputs to a discounted cash flow are the discount rate, and of course, the actual cash flows.

Simply Wall St -

Shareholders Are Thrilled That The Costco Wholesale (NASDAQ:COST) Share Price Increased 129%

But on a lighter note, a good company can see its share price rise well over 100%. … One great example is Costco Wholesale Corporation (NASDAQ:COST) which saw its share price drive 129% higher over five years. … During five years of share price growth, Costco Wholesale achieved compound earnings per share (EPS) growth of 13% per year.

Simply Wall St -

Are Costco Wholesale Corporation’s (NASDAQ:COST) High Returns Really That Great?

The formula for calculating the return on capital employed is: Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities) Or for Costco Wholesale: 0.23 = US$4.7b ÷ (US$44b - US$23b) (Based on the trailing twelve months to May 2019.) So, Costco Wholesale has an ROCE of 23%. … How Costco Wholesale's Current Liabilities Impact Its ROCE Short term (or current) liabilities, are things like supplier invoices, overdrafts, or tax bills that need to be paid within 12 months. … Costco Wholesale boasts an attractive ROCE, even after considering the boost from high current liabilities.

Simply Wall St -

How Much Are Costco Wholesale Corporation (NASDAQ:COST) Insiders Taking Off The Table?

So shareholders might well want to know whether insiders have been buying or selling shares in Costco Wholesale Corporation (NASDAQ:COST). … As Peter Lynch said, 'insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.' Check out our latest analysis for Costco Wholesale Costco Wholesale Insider Transactions Over The Last Year In the last twelve months, the biggest single sale by an insider was when the Executive Vice President of Administration &amp; Human Resources, Franz Lazarus, sold US$5.2m worth of shares at a price of US$227 per share. … Insider Ownership of Costco Wholesale I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders.

Simply Wall St -

Does Costco Wholesale Corporation's (NASDAQ:COST) Past Performance Indicate A Stronger Future?

See our latest analysis for Costco Wholesale Did COST's recent earnings growth beat the long-term trend and the industry? … Let's see if it is only a result of an industry uplift, or if Costco Wholesale has seen some company-specific growth. … I recommend you continue to research Costco Wholesale to get a better picture of the stock by looking at: Future Outlook: What are well-informed industry analysts predicting for COST’s future growth?

Simply Wall St -

Is Costco Wholesale (NASDAQ:COST) Using Too Much Debt?

Debt and other liabilities become risky for a business when it cannot easily fulfill those obligations, either with free cash flow or by raising capital at an attractive price. … NasdaqGS:COST Historical Debt, July 5th 2019 A Look At Costco Wholesale's Liabilities We can see from the most recent balance sheet that Costco Wholesale had liabilities of US$22.8b falling due within a year, and liabilities of US$6.10b due beyond that. … While Costco Wholesale has net cash on its balance sheet, it's still worth taking a look at its ability to convert earnings before interest and tax (EBIT) to free cash flow, to help us understand how quickly it is building (or eroding) that cash balance.

Simply Wall St -

How Much Of Costco Wholesale Corporation (NASDAQ:COST) Do Institutions Own?

A look at the shareholders of Costco Wholesale Corporation (NASDAQ:COST) can tell us which group is most powerful. … View our latest analysis for Costco Wholesale NasdaqGS:COST Ownership Summary, June 13th 2019 What Does The Institutional Ownership Tell Us About Costco Wholesale? … As you can see, institutional investors own 72% of Costco Wholesale.

Simply Wall St -

COST Company Info

Description

Costco Wholesale Corporation, together with its subsidiaries, operates 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. It also operates gas stations, pharmacies, optical dispensing centers, food courts, and hearing-aid centers; and offers business delivery, travel, and various other services online in various countries. As of September 1, 2019, the company operated 782 warehouses, including 543 in the United States and Puerto Rico, 100 in Canada, 39 in Mexico, 29 in the United Kingdom, 26 in Japan, 16 in South Korea, 13 in Taiwan, 11 in Australia, 2 in Spain, 1 in Iceland, 1 in France, and 1 in China. It also operates e-commerce Websites in the United States, Canada, the United Kingdom, Mexico, South Korea, and Taiwan. 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.

Details
Name: Costco Wholesale Corporation
COST
Exchange: NasdaqGS
Founded: 1976
$125,907,691,713
441,579,952
Website: http://www.costco.com
Address: Costco Wholesale Corporation
999 Lake Drive,
Issaquah,
Washington, 98027,
United States
Listings
Exchange Symbol Ticker Symbol Security Exchange Country Currency Listed on
NasdaqGS COST Common Stock Nasdaq Global Select US USD 22. Oct 1993
DB CTO Common Stock Deutsche Boerse AG DE EUR 22. Oct 1993
LSE 0I47 Common Stock London Stock Exchange GB USD 22. Oct 1993
WBAG COST Common Stock Wiener Boerse AG AT EUR 22. Oct 1993
SNSE COST Common Stock Santiago Stock Exchange CL USD 22. Oct 1993
BMV COST * Common Stock Bolsa Mexicana de Valores MX MXN 22. Oct 1993
ETLX CTO Common Stock Eurotlx IT EUR 22. Oct 1993
BOVESPA COWC34 BDR EACH REPR 1/4 COM USD0.005 Bolsa de Valores de Sao Paulo BR BRL 25. Apr 2016
Number of employees
Current staff
Staff numbers
201,500
Costco Wholesale employees.
Industry
Hypermarkets and Super Centers
Consumer Retailing
Company Analysis and Financial Data Status
Area Date (UTC time)
Company Analysis updated: 2020/04/01 00:33
End of day share price update: 2020/03/31 00:00
Last estimates confirmation: 2020/03/28
Last earnings filing: 2020/03/12
Last earnings reported: 2020/02/16
Last annual earnings reported: 2019/09/01


All dates and times in UTC. All financial data provided by Standard & Poor’s Capital IQ.

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.