This Score-Card analysis of Costco Wholesale Corp (COST) attributes an Overall Score to a company by analyzing several aspects that I consider to be among the most important.
In summary, a company to have an overall score close to 100% must have the following characteristics:
- Report high growth rates in the last 3 years (and in the last quarter) in terms of Revenue, Gross Profit, Operating Income and Net Income. Furthermore, it must operate with high and improving margins in recent years.
- Analysts expect Earnings Per Share (EPS) and revenues to grow in the short term (in the next quarter) and in the medium to long term (in the next 5 years). Moreover, they expect the company to be undervalued at current prices and in the last quarter their EPS expectations must have been beaten with a consequent rise in share prices.
- The stock price of the company must have outperformed the S&P 500 index and in the last 3 months the Hedge Funds and Insiders bought shares in the company.
The overall score ranges from 0% (if the characteristics listed above are all very negative) to +100% and it is unlikely that there will be a company with a +100% score because the requirements for achieving this score are very high, however a score higher than +70% can be considered good.
The purpose of this analysis is purely informative.
Score-Card analysis of Costco Wholesale Corp (COST)
- Net Income increased by 55% in the past 3 years
- Excellent last quarter
- Hedge funds increased positions by 38k shares in the last quarter
- Analysts predict 7% EPS annual growth for the next 5 years
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 overall score of COST is 66,7% .
In the last 6 months, COST has underperformed the S&P500 index by -2,0% and analysts believe the company is overvalued by -0,7% .
In the last quarter, the company reported revenue of 37040 million, up by 5,6% compared to the same quarter 12 months earlier. Revenue TTM (Trailing-12-Months) are equal to 154674 million, up by 30,3% in the last 3 years.
COST reported an operating income of 1061 million in the last quarter, an improvement by 11,8% compared to the same quarter 12 months earlier, also reporting an improvement by 5,9% in the operating margin. Considering the sum of the last four quarters (TTM), COST reports an operating income of 4849,0 Million , a growth by 32,1% compared to three years ago and an improvement by 1,4% in the operating margin.
COST reported a net income of 844 million in the last quarter, an improvement by 14,1% compared to the same quarter 12 months earlier, also reporting an improvement by 8,0% in the net margin. The TTM net income is 3642 million , a growth by 55,0% compared to three years ago and the net margin has improved by 19,0% .
In the next quarter, analysts expect growth in EPS (Earnings Per Share) by 2,5% and a growth in revenue by 7,8% . Furthermore, they expect an annual growth by COST EPS by 7,0% for the next 5 years.
In the last quarter, COST reported better EPS than analysts’ expectations and the stock price reacted by decreasing by -1,8% .
Finally, in the last quarter the Hedge Funds have increased their positions by 38k shares. The Insiders have sold shares worth $13.05M .
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Sources & additional info
*The comparison with the S&P 500 index (black line) is visible inside the graph.
*Information updated to the last quarterly report available
*Data in Millions of Dollars
*Data from zacks.com, tipranks.com, reuters.com, finance.yahoo.com
*Company information from finance.yahoo.com
DISCLAIMER: The information in this blog post represents my own analysis/opinions and does not contain a recommendation for any particular security or investment. Stocks trading involves substantial risk of loss and is not suitable for every investor. Trade responsibly.