COSTCO WHOLESALE CORP (1COST.MI) Stock Fundamental Analysis
Europe - Euronext Milan - BIT:1COST - US22160K1051 - Common Stock
730.3 EUR
-2.6 (-0.35%)
Overall 1COST gets a fundamental rating of 6 out of 10. We evaluated 1COST against 24 industry peers in the Consumer Staples Distribution & Retail industry. 1COST has outstanding health and profitabily ratings, belonging to the best of the industry. This is a solid base for any company. 1COST is quite expensive at the moment. It does show a decent growth rate. This makes 1COST very considerable for quality investing!
1. Profitability
1.1 Basic Checks
- 1COST had positive earnings in the past year.
- In the past year 1COST had a positive cash flow from operations.
- In the past 5 years 1COST has always been profitable.
- In the past 5 years 1COST always reported a positive cash flow from operatings.
1.2 Ratios
- The Return On Assets of 1COST (10.03%) is better than 100.00% of its industry peers.
- 1COST has a better Return On Equity (27.40%) than 100.00% of its industry peers.
- With an excellent Return On Invested Capital value of 19.55%, 1COST belongs to the best of the industry, outperforming 100.00% of the companies in the same industry.
- The Average Return On Invested Capital over the past 3 years for 1COST is significantly above the industry average of 9.20%.
- The 3 year average ROIC (19.04%) for 1COST is below the current ROIC(19.55%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.03% | ||
| ROE | 27.4% | ||
| ROIC | 19.55% |
ROA(3y)10.06%
ROA(5y)9.55%
ROE(3y)28.02%
ROE(5y)28.18%
ROIC(3y)19.04%
ROIC(5y)18.81%
1.3 Margins
- Looking at the Profit Margin, with a value of 2.96%, 1COST belongs to the top of the industry, outperforming 80.77% of the companies in the same industry.
- 1COST's Profit Margin has improved in the last couple of years.
- The Operating Margin of 1COST (3.80%) is better than 65.38% of its industry peers.
- 1COST's Operating Margin has been stable in the last couple of years.
- With a Gross Margin value of 12.88%, 1COST is not doing good in the industry: 76.92% of the companies in the same industry are doing better.
- 1COST's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 3.8% | ||
| PM (TTM) | 2.96% | ||
| GM | 12.88% |
OM growth 3Y2.67%
OM growth 5Y0.6%
PM growth 3Y4.55%
PM growth 5Y4.16%
GM growth 3Y1.87%
GM growth 5Y-0.47%
2. Health
2.1 Basic Checks
- 1COST has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
- Compared to 1 year ago, 1COST has about the same amount of shares outstanding.
- The number of shares outstanding for 1COST has been increased compared to 5 years ago.
- Compared to 1 year ago, 1COST has an improved debt to assets ratio.
2.2 Solvency
- An Altman-Z score of 8.55 indicates that 1COST is not in any danger for bankruptcy at the moment.
- 1COST has a Altman-Z score of 8.55. This is amongst the best in the industry. 1COST outperforms 96.15% of its industry peers.
- The Debt to FCF ratio of 1COST is 0.64, which is an excellent value as it means it would take 1COST, only 0.64 years of fcf income to pay off all of its debts.
- 1COST has a Debt to FCF ratio of 0.64. This is amongst the best in the industry. 1COST outperforms 100.00% of its industry peers.
- 1COST has a Debt/Equity ratio of 0.19. This is a healthy value indicating a solid balance between debt and equity.
- 1COST has a better Debt to Equity ratio (0.19) than 100.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.19 | ||
| Debt/FCF | 0.64 | ||
| Altman-Z | 8.55 |
ROIC/WACC2.26
WACC8.65%
2.3 Liquidity
- A Current Ratio of 1.04 indicates that 1COST should not have too much problems paying its short term obligations.
- With a decent Current ratio value of 1.04, 1COST is doing good in the industry, outperforming 73.08% of the companies in the same industry.
- A Quick Ratio of 0.53 indicates that 1COST may have some problems paying its short term obligations.
- With a decent Quick ratio value of 0.53, 1COST is doing good in the industry, outperforming 65.38% of the companies in the same industry.
- 1COST does not score too well on the current and quick ratio evaluation. However, as it has excellent solvency and profitability, these ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.04 | ||
| Quick Ratio | 0.53 |
3. Growth
3.1 Past
- The Earnings Per Share has grown by an nice 9.63% over the past year.
- Measured over the past years, 1COST shows a quite strong growth in Earnings Per Share. The EPS has been growing by 15.76% on average per year.
- Looking at the last year, 1COST shows a quite strong growth in Revenue. The Revenue has grown by 8.34% in the last year.
- The Revenue has been growing by 10.54% on average over the past years. This is quite good.
EPS 1Y (TTM)9.63%
EPS 3Y11.13%
EPS 5Y15.76%
EPS Q2Q%11.39%
Revenue 1Y (TTM)8.34%
Revenue growth 3Y6.64%
Revenue growth 5Y10.54%
Sales Q2Q%8.3%
3.2 Future
- 1COST is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 9.37% yearly.
- 1COST is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 7.09% yearly.
EPS Next Y14.1%
EPS Next 2Y11.83%
EPS Next 3Y11.43%
EPS Next 5Y9.37%
Revenue Next Year8.07%
Revenue Next 2Y7.79%
Revenue Next 3Y7.59%
Revenue Next 5Y7.09%
3.3 Evolution
- When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
- The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- 1COST is valuated quite expensively with a Price/Earnings ratio of 45.53.
- Compared to the rest of the industry, the Price/Earnings ratio of 1COST indicates a slightly more expensive valuation: 1COST is more expensive than 73.08% of the companies listed in the same industry.
- 1COST is valuated expensively when we compare the Price/Earnings ratio to 27.21, which is the current average of the S&P500 Index.
- A Price/Forward Earnings ratio of 37.34 indicates a quite expensive valuation of 1COST.
- Based on the Price/Forward Earnings ratio, 1COST is valued a bit more expensive than the industry average as 69.23% of the companies are valued more cheaply.
- 1COST's Price/Forward Earnings ratio indicates a valuation a bit more expensive than the S&P500 average which is at 25.98.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 45.53 | ||
| Fwd PE | 37.34 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, 1COST is valued a bit more expensive than the industry average as 73.08% of the companies are valued more cheaply.
- Based on the Price/Free Cash Flow ratio, 1COST is valued a bit more expensive than the industry average as 65.38% of the companies are valued more cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 41.85 | ||
| EV/EBITDA | 27.76 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
- The excellent profitability rating of 1COST may justify a higher PE ratio.
PEG (NY)3.23
PEG (5Y)2.89
EPS Next 2Y11.83%
EPS Next 3Y11.43%
5. Dividend
5.1 Amount
- 1COST has a yearly dividend return of 0.57%, which is pretty low.
- 1COST's Dividend Yield is slightly below the industry average, which is at 2.82.
- With a Dividend Yield of 0.57, 1COST pays less dividend than the S&P500 average, which is at 1.81.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.57% |
5.2 History
- The dividend of 1COST is nicely growing with an annual growth rate of 7.97%!
Dividend Growth(5Y)7.97%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
- 1COST pays out 27.04% of its income as dividend. This is a sustainable payout ratio.
- 1COST's earnings are growing around the same pace than its dividend. As long as the earnings growth is kept the dividend growth is sustainable.
DP27.04%
EPS Next 2Y11.83%
EPS Next 3Y11.43%
COSTCO WHOLESALE CORP / 1COST.MI FAQ
What is the fundamental rating for 1COST stock?
ChartMill assigns a fundamental rating of 6 / 10 to 1COST.MI.
What is the valuation status of COSTCO WHOLESALE CORP (1COST.MI) stock?
ChartMill assigns a valuation rating of 1 / 10 to COSTCO WHOLESALE CORP (1COST.MI). This can be considered as Overvalued.
Can you provide the profitability details for COSTCO WHOLESALE CORP?
COSTCO WHOLESALE CORP (1COST.MI) has a profitability rating of 8 / 10.
What is the expected EPS growth for COSTCO WHOLESALE CORP (1COST.MI) stock?
The Earnings per Share (EPS) of COSTCO WHOLESALE CORP (1COST.MI) is expected to grow by 14.1% in the next year.
Is the dividend of COSTCO WHOLESALE CORP sustainable?
The dividend rating of COSTCO WHOLESALE CORP (1COST.MI) is 3 / 10 and the dividend payout ratio is 27.04%.