Head-To-Head Contrast: Costco Wholesale (COST) & The Competition

Costco Wholesale (NASDAQ:COST) is one of 149 public companies in the “Consumer Staples Distribution & Retail” industry, but how does it weigh in compared to its peers? We will compare Costco Wholesale to related companies based on the strength of its risk, analyst recommendations, institutional ownership, valuation, profitability, dividends and earnings.

Insider & Institutional Ownership

68.5% of Costco Wholesale shares are held by institutional investors. Comparatively, 45.0% of shares of all “Consumer Staples Distribution & Retail” companies are held by institutional investors. 0.1% of Costco Wholesale shares are held by insiders. Comparatively, 19.7% of shares of all “Consumer Staples Distribution & Retail” companies are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Profitability

This table compares Costco Wholesale and its peers’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Costco Wholesale	3.04%	27.60%	10.63%
Costco Wholesale Competitors	-25.86%	3.87%	2.96%

Analyst Ratings

This is a breakdown of current recommendations and price targets for Costco Wholesale and its peers, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Costco Wholesale	1	8	24	1	2.74
Costco Wholesale Competitors	2243	8272	10046	459	2.41

Costco Wholesale currently has a consensus target price of $1,090.55, indicating a potential upside of 2.34%. As a group, “Consumer Staples Distribution & Retail” companies have a potential upside of 66.28%. Given Costco Wholesale’s peers higher possible upside, analysts clearly believe Costco Wholesale has less favorable growth aspects than its peers.

Valuation & Earnings

This table compares Costco Wholesale and its peers top-line revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Costco Wholesale	$303.15 billion	$9.23 billion	51.33
Costco Wholesale Competitors	$36.50 billion	$846.26 million	16.10

Costco Wholesale has higher revenue and earnings than its peers. Costco Wholesale is trading at a higher price-to-earnings ratio than its peers, indicating that it is currently more expensive than other companies in its industry.

Volatility & Risk

Costco Wholesale has a beta of 0.85, meaning that its stock price is 15% less volatile than the S&P 500. Comparatively, Costco Wholesale’s peers have a beta of 0.44, meaning that their average stock price is 56% less volatile than the S&P 500.

Dividends

Costco Wholesale pays an annual dividend of $5.88 per share and has a dividend yield of 0.6%. Costco Wholesale pays out 28.3% of its earnings in the form of a dividend. As a group, “Consumer Staples Distribution & Retail” companies pay a dividend yield of 3.8% and pay out 36.7% of their earnings in the form of a dividend. Costco Wholesale has increased its dividend for 22 consecutive years.

Summary

Costco Wholesale beats its peers on 12 of the 15 factors compared.

About Costco Wholesale

Costco Wholesale Corporation, together with its subsidiaries, engages in the operation of membership warehouses in the United States, Puerto Rico, Canada, Mexico, Japan, the United Kingdom, Korea, Australia, Taiwan, China, Spain, France, Iceland, New Zealand, and Sweden. The company offers branded and private-label products in a range of merchandise categories. It offers merchandise, such as sundries, dry groceries, candies, coolers, freezers, deli, liquor, and tobacco; appliances, electronics, health and beauty aids, hardware, garden and patio products, sporting goods, tires, toys and seasonal products, office supplies, automotive care products, postages, tickets, apparel, small appliances, furniture, domestics, housewares, special order kiosks, and jewelry; and meat, produce, service deli, and bakery products. The company also operates gasoline, pharmacies, optical, food courts, hearing-aid centers, and tire installation centers; and offers business delivery, travel, grocery, and various other services online. It also operates e-commerce websites. 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.