Stock Analysis on Net
Stock Analysis on Net
Microsoft Excel LibreOffice Calc

Costco Wholesale Corp. (NASDAQ:COST)

Analysis of Profitability Ratios

Beginner level

Profitability Ratios (Summary)

Costco Wholesale Corp., profitability ratios

Microsoft Excel LibreOffice Calc
Aug 30, 2020 Sep 1, 2019 Sep 2, 2018 Sep 3, 2017 Aug 28, 2016 Aug 30, 2015
Return on Sales
Gross profit margin 11.20% 11.02% 11.04% 11.33% 11.35% 11.09%
Operating profit margin 3.33% 3.17% 3.24% 3.26% 3.16% 3.19%
Net profit margin 2.45% 2.45% 2.26% 2.12% 2.02% 2.09%
Return on Investment
Return on equity (ROE) 21.89% 24.00% 24.49% 24.86% 19.46% 22.39%
Return on assets (ROA) 7.20% 8.06% 7.68% 7.37% 7.09% 7.11%

Based on: 10-K (filing date: 2020-10-07), 10-K (filing date: 2019-10-11), 10-K (filing date: 2018-10-26), 10-K (filing date: 2017-10-18), 10-K (filing date: 2016-10-12), 10-K (filing date: 2015-10-14).

Profitability ratio Description The company
Gross profit margin Gross profit margin indicates the percentage of revenue available to cover operating and other expenditures. Costco Wholesale Corp.’s gross profit margin ratio deteriorated from 2018 to 2019 but then improved from 2019 to 2020 exceeding 2018 level.
Operating profit margin A profitability ratio calculated as operating income divided by revenue. Costco Wholesale Corp.’s operating profit margin ratio deteriorated from 2018 to 2019 but then improved from 2019 to 2020 exceeding 2018 level.
Net profit margin An indicator of profitability, calculated as net income divided by revenue. Costco Wholesale Corp.’s net profit margin ratio improved from 2018 to 2019 and from 2019 to 2020.

Profitability ratio Description The company
ROE A profitability ratio calculated as net income divided by shareholders’ equity. Costco Wholesale Corp.’s ROE deteriorated from 2018 to 2019 and from 2019 to 2020.
ROA A profitability ratio calculated as net income divided by total assets. Costco Wholesale Corp.’s ROA improved from 2018 to 2019 but then deteriorated significantly from 2019 to 2020.

Gross Profit Margin

Costco Wholesale Corp., gross profit margin calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Aug 30, 2020 Sep 1, 2019 Sep 2, 2018 Sep 3, 2017 Aug 28, 2016 Aug 30, 2015
Selected Financial Data (US$ in millions)
Gross margin 18,281  16,465  15,282  14,290  13,172  12,601 
Net sales 163,220  149,351  138,434  126,172  116,073  113,666 
Profitability Ratio
Gross profit margin1 11.20% 11.02% 11.04% 11.33% 11.35% 11.09%
Benchmarks
Gross Profit Margin, Competitors2
Amazon.com Inc. 39.57% 40.99% 40.25% 37.07% 35.09%
Dollar General Corp. 30.59% 30.45% 30.77% 30.85% 30.96%
Home Depot Inc. 34.09% 34.34% 34.05% 34.16% 34.19%
Lowe’s Cos. Inc. 31.80% 32.12% 34.11% 34.55% 34.82%
Target Corp. 28.87% 28.39% 28.87% 29.68% 29.53%
TJX Cos. Inc. 28.46% 28.59% 28.89% 28.98% 28.79%
Walmart Inc. 24.10% 24.50% 24.68% 24.94% 24.58%

Based on: 10-K (filing date: 2020-10-07), 10-K (filing date: 2019-10-11), 10-K (filing date: 2018-10-26), 10-K (filing date: 2017-10-18), 10-K (filing date: 2016-10-12), 10-K (filing date: 2015-10-14).

1 2020 Calculation
Gross profit margin = 100 × Gross margin ÷ Net sales
= 100 × 18,281 ÷ 163,220 = 11.20%

2 Click competitor name to see calculations.

Profitability ratio Description The company
Gross profit margin Gross profit margin indicates the percentage of revenue available to cover operating and other expenditures. Costco Wholesale Corp.’s gross profit margin ratio deteriorated from 2018 to 2019 but then improved from 2019 to 2020 exceeding 2018 level.

Operating Profit Margin

Costco Wholesale Corp., operating profit margin calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Aug 30, 2020 Sep 1, 2019 Sep 2, 2018 Sep 3, 2017 Aug 28, 2016 Aug 30, 2015
Selected Financial Data (US$ in millions)
Operating income 5,435  4,737  4,480  4,111  3,672  3,624 
Net sales 163,220  149,351  138,434  126,172  116,073  113,666 
Profitability Ratio
Operating profit margin1 3.33% 3.17% 3.24% 3.26% 3.16% 3.19%
Benchmarks
Operating Profit Margin, Competitors2
Amazon.com Inc. 5.93% 5.18% 5.33% 2.31% 3.08%
Dollar General Corp. 8.30% 8.26% 8.55% 9.39% 9.53%
Home Depot Inc. 14.37% 14.35% 14.55% 14.19% 13.30%
Lowe’s Cos. Inc. 8.75% 5.63% 9.60% 8.99% 8.41%
Target Corp. 6.04% 5.52% 6.00% 7.15% 7.49%
TJX Cos. Inc. 10.59% 10.82% 10.84% 11.60% 11.97%
Walmart Inc. 3.96% 4.30% 4.12% 4.73% 5.04%
Operating Profit Margin, Sector
General Retailers 5.90% 5.66% 5.89% 5.72% 5.97%
Operating Profit Margin, Industry
Consumer Services 6.80% 7.83% 8.04% 8.34% 8.43%

Based on: 10-K (filing date: 2020-10-07), 10-K (filing date: 2019-10-11), 10-K (filing date: 2018-10-26), 10-K (filing date: 2017-10-18), 10-K (filing date: 2016-10-12), 10-K (filing date: 2015-10-14).

1 2020 Calculation
Operating profit margin = 100 × Operating income ÷ Net sales
= 100 × 5,435 ÷ 163,220 = 3.33%

2 Click competitor name to see calculations.

Profitability ratio Description The company
Operating profit margin A profitability ratio calculated as operating income divided by revenue. Costco Wholesale Corp.’s operating profit margin ratio deteriorated from 2018 to 2019 but then improved from 2019 to 2020 exceeding 2018 level.

Net Profit Margin

Costco Wholesale Corp., net profit margin calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Aug 30, 2020 Sep 1, 2019 Sep 2, 2018 Sep 3, 2017 Aug 28, 2016 Aug 30, 2015
Selected Financial Data (US$ in millions)
Net income attributable to Costco 4,002  3,659  3,134  2,679  2,350  2,377 
Net sales 163,220  149,351  138,434  126,172  116,073  113,666 
Profitability Ratio
Net profit margin1 2.45% 2.45% 2.26% 2.12% 2.02% 2.09%
Benchmarks
Net Profit Margin, Competitors2
Amazon.com Inc. 5.53% 4.13% 4.33% 1.71% 1.74%
Dollar General Corp. 6.17% 6.20% 6.56% 5.69% 5.72%
Home Depot Inc. 10.20% 10.28% 8.55% 8.41% 7.92%
Lowe’s Cos. Inc. 5.93% 3.25% 5.02% 4.76% 4.31%
Target Corp. 4.25% 3.95% 4.08% 3.94% 4.56%
TJX Cos. Inc. 7.84% 7.85% 7.27% 6.93% 7.36%
Walmart Inc. 2.86% 1.31% 1.99% 2.83% 3.07%
Net Profit Margin, Sector
General Retailers 4.58% 3.41% 3.62% 3.43% 3.57%
Net Profit Margin, Industry
Consumer Services 4.63% 5.03% 5.07% 6.37% 5.14%

Based on: 10-K (filing date: 2020-10-07), 10-K (filing date: 2019-10-11), 10-K (filing date: 2018-10-26), 10-K (filing date: 2017-10-18), 10-K (filing date: 2016-10-12), 10-K (filing date: 2015-10-14).

1 2020 Calculation
Net profit margin = 100 × Net income attributable to Costco ÷ Net sales
= 100 × 4,002 ÷ 163,220 = 2.45%

2 Click competitor name to see calculations.

Profitability ratio Description The company
Net profit margin An indicator of profitability, calculated as net income divided by revenue. Costco Wholesale Corp.’s net profit margin ratio improved from 2018 to 2019 and from 2019 to 2020.

Return on Equity (ROE)

Costco Wholesale Corp., ROE calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Aug 30, 2020 Sep 1, 2019 Sep 2, 2018 Sep 3, 2017 Aug 28, 2016 Aug 30, 2015
Selected Financial Data (US$ in millions)
Net income attributable to Costco 4,002  3,659  3,134  2,679  2,350  2,377 
Total Costco stockholders’ equity 18,284  15,243  12,799  10,778  12,079  10,617 
Profitability Ratio
ROE1 21.89% 24.00% 24.49% 24.86% 19.46% 22.39%
Benchmarks
ROE, Competitors2
Amazon.com Inc. 22.84% 18.67% 23.13% 10.95% 12.29%
Dollar General Corp. 25.55% 24.77% 25.12% 23.14% 21.66%
Home Depot Inc. 593.54% 183.64% 110.97%
Lowe’s Cos. Inc. 217.09% 63.50% 58.69% 48.07% 33.26%
Target Corp. 27.73% 26.00% 25.06% 24.99% 25.96%
TJX Cos. Inc. 55.01% 60.61% 50.66% 50.95% 52.88%
Walmart Inc. 19.93% 9.20% 12.66% 17.54% 18.24%
ROE, Sector
General Retailers 30.52% 24.63% 25.67% 24.80% 24.09%
ROE, Industry
Consumer Services 18.98% 20.83% 21.33% 27.27% 21.40%

Based on: 10-K (filing date: 2020-10-07), 10-K (filing date: 2019-10-11), 10-K (filing date: 2018-10-26), 10-K (filing date: 2017-10-18), 10-K (filing date: 2016-10-12), 10-K (filing date: 2015-10-14).

1 2020 Calculation
ROE = 100 × Net income attributable to Costco ÷ Total Costco stockholders’ equity
= 100 × 4,002 ÷ 18,284 = 21.89%

2 Click competitor name to see calculations.

Profitability ratio Description The company
ROE A profitability ratio calculated as net income divided by shareholders’ equity. Costco Wholesale Corp.’s ROE deteriorated from 2018 to 2019 and from 2019 to 2020.

Return on Assets (ROA)

Costco Wholesale Corp., ROA calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Aug 30, 2020 Sep 1, 2019 Sep 2, 2018 Sep 3, 2017 Aug 28, 2016 Aug 30, 2015
Selected Financial Data (US$ in millions)
Net income attributable to Costco 4,002  3,659  3,134  2,679  2,350  2,377 
Total assets 55,556  45,400  40,830  36,347  33,163  33,440 
Profitability Ratio
ROA1 7.20% 8.06% 7.68% 7.37% 7.09% 7.11%
Benchmarks
ROA, Competitors2
Amazon.com Inc. 6.64% 5.14% 6.19% 2.31% 2.84%
Dollar General Corp. 7.50% 12.04% 12.30% 10.72% 10.35%
Home Depot Inc. 21.94% 25.27% 19.38% 18.52% 16.47%
Lowe’s Cos. Inc. 10.85% 6.71% 9.77% 8.99% 8.14%
Target Corp. 7.67% 7.11% 7.52% 7.31% 8.35%
TJX Cos. Inc. 13.55% 21.36% 18.55% 17.84% 19.81%
Walmart Inc. 6.29% 3.04% 4.82% 6.86% 7.36%
ROA, Sector
General Retailers 8.06% 6.74% 7.63% 7.25% 7.90%
ROA, Industry
Consumer Services 5.07% 5.78% 6.13% 8.54% 6.92%

Based on: 10-K (filing date: 2020-10-07), 10-K (filing date: 2019-10-11), 10-K (filing date: 2018-10-26), 10-K (filing date: 2017-10-18), 10-K (filing date: 2016-10-12), 10-K (filing date: 2015-10-14).

1 2020 Calculation
ROA = 100 × Net income attributable to Costco ÷ Total assets
= 100 × 4,002 ÷ 55,556 = 7.20%

2 Click competitor name to see calculations.

Profitability ratio Description The company
ROA A profitability ratio calculated as net income divided by total assets. Costco Wholesale Corp.’s ROA improved from 2018 to 2019 but then deteriorated significantly from 2019 to 2020.