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Costco Wholesale Corporation (COST): What’s Driving Sales at This Retailer?

Costco Wholesale Corporation (NASDAQ:COST) has reported the lowest operating margin of 3% among the three mentioned peers, and highest one-year forward P/E of 21.98. Wal-Mart Stores, Inc. (NYSE:WMT) has lowest P/S ratio of 0.54, but with moderate operating margin and forward P/E. Target Corporation (NYSE:TGT) is performing the best among the three peers with the highest operating margin of 8.43% and the lowest forward P/E of 12.64.

Conclusion

Costco has achieved a high renewal rate for its membership, and was able to increase its membership fee revenue by 12% in the last quarter. It has store expansion plans this year, which has helped it to attract new members. It has also increased its international presence this year. Its stock repurchase program indicates confidence of the company in the stock and it is expected to do well in future. So, I will recommend a Buy.


Ash Sharma has no position in any stocks mentioned. The Motley Fool recommends Costco Wholesale (NASDAQ:COST). The Motley Fool owns shares of Costco Wholesale.

The article What’s Driving Sales at This Retailer? originally appeared on Fool.com.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

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