Costco Wholesale (NAS:COST) GF Value Rank

: 3 (As of Today)

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Costco Wholesale has the GF Value Rank of 3.

The GF Value Rank is determined by the price-to-GF-Value (P/GF Value) ratio, a proprietary metric calculated based on historical multiples along with an adjustment factor based on a company's past returns and growth and future estimates of the business' performance.

GuruFocus found that for valuation, we cannot simply give stocks a better GF Value rank simply because they have a lower P/GF Value ratio. Backtesting shows that over the long term, the two worst-performing groups are the most expensive group (with the highest P/GF Value ratio) and the least expensive group (with the lowest P/GF Value ratio).

We can understand why the most expensive group underperforms. We were initially puzzled by the underperformance of the least expensive group, but we realized there is a reason why some stocks are super cheap. If they look too undervalued, it is often because the businesses behind them are poor quality. The market realized this and gave them low valuations. In a way, the market is efficient.

After multiple backtesting analyses, we granted the stocks in third-cheapest percentile the highest GF Value rank, as they have performed the best over a full market cycle. Stock performance is actually not as sensitive to valuation as it is to growth and profitability. On average, the companies in the 20%-50% valuation groups have similar performances. Therefore, we should avoid the most expensive and the least expensive stocks. We can be more tolerant of valuation.

Please click GF Score to see more details on the GF Score's 5 Key Aspects of Analysis.

Competitive Comparison

For the Discount Stores subindustry, Costco Wholesale's GF Value Rank, along with its competitors' market caps and GF Value Rank data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

Annual Data Quarterly Data

Costco Wholesale GF Value Rank Distribution

For the Retail - Defensive industry and Consumer Defensive sector, Costco Wholesale's GF Value Rank distribution charts can be found below:

* The bar in red indicates where Costco Wholesale's GF Value Rank falls in comparison to its industry or sector. The grey bar indicates the GF Value Rank's extreme value range as defined by GuruFocus.

Costco Wholesale GF Value Rank Related Terms

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Costco Wholesale (NAS:COST) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Consumer Defensive » Retail - Defensive » Costco Wholesale Corp (NAS:COST) » Definitions » GF Value Rank

Comparable Companies

Traded in Other Exchanges

COST:Mexico CTO0:Germany CTO:Germany CTO:Germany CTO:Germany CTO:Germany COST:Chile COST:Canada COWC34:Brazil COST:Argentina

Address

999 Lake Drive, Issaquah, WA, USA, 98027

Website

https://www.costco.com

Costco operates a membership-based, no-frills retail model, predicated on offering a select product assortment in bulk quantities at bargain prices. The firm avoids maintaining costly product displays by keeping inventory on pallets and limits distribution expenses by storing its inventory at point of sale in the warehouse. Given Costco's frugal cost structure, the firm is able to price its merchandise below competing retailers, driving high sales volume per warehouse and allowing the retailer to generate strong profits on thin margins. Costco operates 591 warehouses in the United States and boasts over 60% market share in the domestic warehouse club industry. Internationally, Costco operates another 270 warehouses, primarily in markets such as Canada, Mexico, Japan, and the U.K.

Executives

Helena Foulkes	director	ONE CVS DRIVE, WOONSOCKET RI 02895
Caton Frates	officer: Executive Vice President	999 LAKE DRIVE, ISSAQUAH WA 98027
Pierre Riel	officer: EVP	999 LAKE DRIVE, ISSAQUAH WA 98027
Claudine Adamo	officer: Executive Vice President	999 LAKE DRIVE, ISSAQUAH WA 98027
John Christopher Sullivan	officer: Executive VP	999 LAKE DRIVE, ISSAQUAH WA 98027
Yoram Rubananko	officer: Executive VP	999 LAKE DRIVE, ISSAQUAH WA 98027
Jewell Sarah Mr Sally	director	1411 E MISSION AVE, SPOKANE WA 99202
Patrick J Callans	officer: Executive VP	999 LAKE DRIVE, ISSAQUAH WA 98027
Russell D Miller	officer: Executive Vice President	999 LAKE DRIVE, ISSAQUAH WA 98027
James C Klauer	officer: Executive Vice President	999 LAKE DRIVE, ISSAQUAH WA 98027
Kenneth D Denman	director
Daniel M. Hines	other: Principal Acctg Officer	999 LAKE DRIVE, ISSAQUAH WA 98027
Roland Michael Vachris	officer: Executive VP	999 LAKE DRIVE, ISSAQUAH WA 98027
John W Stanton	director	3650 131ST AVE SE #400, WESTERN WIRELESS CORP, BELLEVUE WA 98006
Mary Agnes Wilderotter	director	115 ALPINE TERRACE, OAKLAND CA 94618