COSTCO WHOLESALE CORP (CTO.DE) Stock Fundamental Analysis
FRA:CTO - Deutsche Boerse Ag - US22160K1051 - Common Stock - Currency: EUR
We assign a fundamental rating of 6 out of 10 to CTO. CTO was compared to 26 industry peers in the Consumer Staples Distribution & Retail industry. CTO scores excellent points on both the profitability and health parts. This is a solid base for a good stock. While showing a medium growth rate, CTO is valued expensive at the moment. These ratings would make CTO suitable for quality investing!
1. Profitability
1.1 Basic Checks
In the past year CTO was profitable.
CTO had a positive operating cash flow in the past year.
In the past 5 years CTO has always been profitable.
In the past 5 years CTO always reported a positive cash flow from operatings.
1.2 Ratios
Looking at the Return On Assets, with a value of 10.41%, CTO belongs to the top of the industry, outperforming 96.43% of the companies in the same industry.
Looking at the Return On Equity, with a value of 29.80%, CTO belongs to the top of the industry, outperforming 92.86% of the companies in the same industry.
With an excellent Return On Invested Capital value of 20.16%, CTO belongs to the best of the industry, outperforming 100.00% of the companies in the same industry.
CTO had an Average Return On Invested Capital over the past 3 years of 18.60%. This is significantly above the industry average of 9.00%.
The 3 year average ROIC (18.60%) for CTO is below the current ROIC(20.16%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.41% | ||
| ROE | 29.8% | ||
| ROIC | 20.16% |
ROA(3y)9.59%
ROA(5y)8.89%
ROE(3y)28.2%
ROE(5y)27%
ROIC(3y)18.6%
ROIC(5y)17.81%
1.3 Margins
With an excellent Profit Margin value of 2.89%, CTO belongs to the best of the industry, outperforming 89.29% of the companies in the same industry.
In the last couple of years the Profit Margin of CTO has grown nicely.
Looking at the Operating Margin, with a value of 3.69%, CTO is in the better half of the industry, outperforming 67.86% of the companies in the same industry.
In the last couple of years the Operating Margin of CTO has grown nicely.
The Gross Margin of CTO (12.67%) is worse than 82.14% of its industry peers.
In the last couple of years the Gross Margin of CTO has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 3.69% | ||
| PM (TTM) | 2.89% | ||
| GM | 12.67% |
OM growth 3Y-0.72%
OM growth 5Y3.3%
PM growth 3Y4.25%
PM growth 5Y3.86%
GM growth 3Y-0.71%
GM growth 5Y-0.57%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), CTO is creating value.
The number of shares outstanding for CTO remains at a similar level compared to 1 year ago.
The number of shares outstanding for CTO has been increased compared to 5 years ago.
CTO has a better debt/assets ratio than last year.
2.2 Solvency
CTO has an Altman-Z score of 9.77. This indicates that CTO is financially healthy and has little risk of bankruptcy at the moment.
With an excellent Altman-Z score value of 9.77, CTO belongs to the best of the industry, outperforming 96.43% of the companies in the same industry.
CTO has a debt to FCF ratio of 0.83. This is a very positive value and a sign of high solvency as it would only need 0.83 years to pay back of all of its debts.
CTO's Debt to FCF ratio of 0.83 is amongst the best of the industry. CTO outperforms 100.00% of its industry peers.
CTO has a Debt/Equity ratio of 0.23. This is a healthy value indicating a solid balance between debt and equity.
Looking at the Debt to Equity ratio, with a value of 0.23, CTO belongs to the top of the industry, outperforming 92.86% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.23 | ||
| Debt/FCF | 0.83 | ||
| Altman-Z | 9.77 |
ROIC/WACC2.29
WACC8.82%
2.3 Liquidity
CTO has a Current Ratio of 1.00. This is a bad value and indicates that CTO is not financially healthy enough and could expect problems in meeting its short term obligations.
CTO has a Current ratio of 1.00. This is in the better half of the industry: CTO outperforms 71.43% of its industry peers.
CTO has a Quick Ratio of 1.00. This is a bad value and indicates that CTO is not financially healthy enough and could expect problems in meeting its short term obligations.
CTO has a Quick ratio of 0.49. This is comparable to the rest of the industry: CTO outperforms 50.00% of its industry peers.
The current and quick ratio evaluation for CTO is rather negative, while it does have 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 | ||
| Quick Ratio | 0.49 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 12.03% over the past year.
Measured over the past years, CTO shows a quite strong growth in Earnings Per Share. The EPS has been growing by 15.11% on average per year.
The Revenue has been growing slightly by 6.13% in the past year.
The Revenue has been growing by 10.75% on average over the past years. This is quite good.
EPS 1Y (TTM)12.03%
EPS 3Y14.32%
EPS 5Y15.11%
EPS Q2Q%2.55%
Revenue 1Y (TTM)6.13%
Revenue growth 3Y9.1%
Revenue growth 5Y10.75%
Sales Q2Q%9.04%
3.2 Future
Based on estimates for the next years, CTO will show a quite strong growth in Earnings Per Share. The EPS will grow by 12.46% on average per year.
CTO is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 6.52% yearly.
EPS Next Y12.34%
EPS Next 2Y10.93%
EPS Next 3Y10.99%
EPS Next 5Y12.46%
Revenue Next Year6.99%
Revenue Next 2Y7.03%
Revenue Next 3Y6.83%
Revenue Next 5Y6.52%
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 stable.
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
With a Price/Earnings ratio of 55.84, CTO can be considered very expensive at the moment.
Based on the Price/Earnings ratio, CTO is valued a bit more expensive than 67.86% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 29.35. CTO is valued rather expensively when compared to this.
With a Price/Forward Earnings ratio of 46.92, CTO can be considered very expensive at the moment.
Based on the Price/Forward Earnings ratio, CTO is valued more expensive than 82.14% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 22.10, CTO is valued quite expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 55.84 | ||
| Fwd PE | 46.92 |
4.2 Price Multiples
71.43% of the companies in the same industry are cheaper than CTO, based on the Enterprise Value to EBITDA ratio.
Based on the Price/Free Cash Flow ratio, CTO is valued a bit more expensive than 71.43% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 61.32 | ||
| EV/EBITDA | 34.49 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates CTO does not grow enough to justify the current Price/Earnings ratio.
The excellent profitability rating of CTO may justify a higher PE ratio.
PEG (NY)4.52
PEG (5Y)3.7
EPS Next 2Y10.93%
EPS Next 3Y10.99%
5. Dividend
5.1 Amount
With a yearly dividend of 0.45%, CTO is not a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 3.95, CTO is paying slightly less dividend.
With a Dividend Yield of 0.45, CTO pays less dividend than the S&P500 average, which is at 2.33.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.45% |
5.2 History
The dividend of CTO is nicely growing with an annual growth rate of 53.89%!
Dividend Growth(5Y)53.89%
Div Incr Years2
Div Non Decr Years2
5.3 Sustainability
20.26% of the earnings are spent on dividend by CTO. This is a low number and sustainable payout ratio.
The dividend of CTO is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP20.26%
EPS Next 2Y10.93%
EPS Next 3Y10.99%
FRA:CTO (3/7/2025, 7:00:00 PM)
881.1
-81.7 (-8.49%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupConsumer Staples Distribution & Retail
GICS IndustryConsumer Staples Distribution & Retail
Earnings (Last)
Earnings (Next)
Inst Owners71.84%
Inst Owner ChangeN/A
Ins Owners0.09%
Ins Owner ChangeN/A
Market Cap391.12B
Analysts79.13
Price Target1021.64 (15.95%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.45% |
Yearly Dividend18.79
Dividend Growth(5Y)53.89%
DP20.26%
Div Incr Years2
Div Non Decr Years2
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)0.36%
Min EPS beat(2)-3.79%
Max EPS beat(2)4.5%
EPS beat(4)3
Avg EPS beat(4)0.78%
Min EPS beat(4)-3.79%
Max EPS beat(4)4.5%
EPS beat(8)5
Avg EPS beat(8)-0.18%
EPS beat(12)7
Avg EPS beat(12)-0.14%
EPS beat(16)11
Avg EPS beat(16)2.24%
Revenue beat(2)0
Avg Revenue beat(2)-1.4%
Min Revenue beat(2)-1.85%
Max Revenue beat(2)-0.95%
Revenue beat(4)0
Avg Revenue beat(4)-1.65%
Min Revenue beat(4)-2.61%
Max Revenue beat(4)-0.95%
Revenue beat(8)0
Avg Revenue beat(8)-1.98%
Revenue beat(12)0
Avg Revenue beat(12)-1.9%
Revenue beat(16)2
Avg Revenue beat(16)-1.4%
PT rev (1m)3.33%
PT rev (3m)12.39%
EPS NQ rev (1m)-0.08%
EPS NQ rev (3m)0.4%
EPS NY rev (1m)0.2%
EPS NY rev (3m)2.12%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.32%
Revenue NY rev (1m)0.11%
Revenue NY rev (3m)-0.07%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 55.84 | ||
| Fwd PE | 46.92 | ||
| P/S | 1.61 | ||
| P/FCF | 61.32 | ||
| P/OCF | 35.49 | ||
| P/B | 16.6 | ||
| P/tB | 16.6 | ||
| EV/EBITDA | 34.49 |
EPS(TTM)15.78
EY1.79%
EPS(NY)18.78
Fwd EY2.13%
FCF(TTM)14.37
FCFY1.63%
OCF(TTM)24.83
OCFY2.82%
SpS547.96
BVpS53.07
TBVpS53.07
PEG (NY)4.52
PEG (5Y)3.7
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.41% | ||
| ROE | 29.8% | ||
| ROCE | 26.92% | ||
| ROIC | 20.16% | ||
| ROICexc | 31.66% | ||
| ROICexgc | 31.66% | ||
| OM | 3.69% | ||
| PM (TTM) | 2.89% | ||
| GM | 12.67% | ||
| FCFM | 2.62% |
ROA(3y)9.59%
ROA(5y)8.89%
ROE(3y)28.2%
ROE(5y)27%
ROIC(3y)18.6%
ROIC(5y)17.81%
ROICexc(3y)29.37%
ROICexc(5y)29.08%
ROICexgc(3y)30.8%
ROICexgc(5y)30.84%
ROCE(3y)24.84%
ROCE(5y)23.78%
ROICexcg growth 3Y-2.2%
ROICexcg growth 5Y2.32%
ROICexc growth 3Y-1.15%
ROICexc growth 5Y1.43%
OM growth 3Y-0.72%
OM growth 5Y3.3%
PM growth 3Y4.25%
PM growth 5Y3.86%
GM growth 3Y-0.71%
GM growth 5Y-0.57%
F-Score8
Asset Turnover3.61
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.23 | ||
| Debt/FCF | 0.83 | ||
| Debt/EBITDA | 0.48 | ||
| Cap/Depr | 217.05% | ||
| Cap/Sales | 1.91% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 99.11% | ||
| Profit Quality | 90.87% | ||
| Current Ratio | 1 | ||
| Quick Ratio | 0.49 | ||
| Altman-Z | 9.77 |
F-Score8
WACC8.82%
ROIC/WACC2.29
Cap/Depr(3y)207.83%
Cap/Depr(5y)199.15%
Cap/Sales(3y)1.78%
Cap/Sales(5y)1.77%
Profit Quality(3y)85.7%
Profit Quality(5y)103.11%
High Growth Momentum
Growth
EPS 1Y (TTM)12.03%
EPS 3Y14.32%
EPS 5Y15.11%
EPS Q2Q%2.55%
EPS Next Y12.34%
EPS Next 2Y10.93%
EPS Next 3Y10.99%
EPS Next 5Y12.46%
Revenue 1Y (TTM)6.13%
Revenue growth 3Y9.1%
Revenue growth 5Y10.75%
Sales Q2Q%9.04%
Revenue Next Year6.99%
Revenue Next 2Y7.03%
Revenue Next 3Y6.83%
Revenue Next 5Y6.52%
EBIT growth 1Y14.64%
EBIT growth 3Y8.31%
EBIT growth 5Y14.41%
EBIT Next Year39.64%
EBIT Next 3Y19.62%
EBIT Next 5Y17.81%
FCF growth 1Y26.48%
FCF growth 3Y7.27%
FCF growth 5Y14.57%
OCF growth 1Y25.49%
OCF growth 3Y8.17%
OCF growth 5Y12.27%