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Microsoft Excel LibreOffice Calc

Costco Wholesale Corp. (NASDAQ:COST)

Analysis of Short-term (Operating) Activity Ratios

Beginner level

Activity ratios measure how efficiently a company performs day-to-day tasks, such us the collection of receivables and management of inventory.

Short-term Activity Ratios (Summary)

Costco Wholesale Corp., short-term (operating) activity ratios

Microsoft Excel LibreOffice Calc
Sep 1, 2019 Sep 2, 2018 Sep 3, 2017 Aug 28, 2016 Aug 30, 2015 Aug 31, 2014
Turnover Ratios
Inventory turnover
Receivables turnover
Payables turnover
Working capital turnover
Average No. Days
Average inventory processing period
Add: Average receivable collection period
Operating cycle
Less: Average payables payment period
Cash conversion cycle

Based on: 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), 10-K (filing date: 2014-10-15).

Short-term activity ratio Description The company
Inventory turnover An activity ratio calculated as cost of goods sold divided by inventory. Costco Wholesale Corp.’s inventory turnover ratio deteriorated from 2017 to 2018 but then improved from 2018 to 2019 exceeding 2017 level.
Receivables turnover An activity ratio equal to revenue divided by receivables. Costco Wholesale Corp.’s receivables turnover ratio deteriorated from 2017 to 2018 but then improved from 2018 to 2019 exceeding 2017 level.
Payables turnover An activity ratio calculated as cost of goods sold divided by payables. Costco Wholesale Corp.’s payables turnover ratio decreased from 2017 to 2018 but then increased from 2018 to 2019 not reaching 2017 level.
Working capital turnover An activity ratio calculated as revenue divided by working capital. Costco Wholesale Corp.’s working capital turnover ratio improved from 2017 to 2018 and from 2018 to 2019.
Short-term activity ratio Description The company
Average inventory processing period An activity ratio equal to the number of days in the period divided by inventory turnover over the period. Costco Wholesale Corp.’s number of days of inventory outstanding deteriorated from 2017 to 2018 but then improved from 2018 to 2019 exceeding 2017 level.
Average receivable collection period An activity ratio equal to the number of days in the period divided by receivables turnover.
Operating cycle Equal to average inventory processing period plus average receivables collection period. Costco Wholesale Corp.’s operating cycle deteriorated from 2017 to 2018 but then improved from 2018 to 2019 exceeding 2017 level.
Average payables payment period An estimate of the average number of days it takes a company to pay its suppliers; equal to the number of days in the period divided by payables turnover ratio for the period.
Cash conversion cycle A financial metric that measures the length of time required for a company to convert cash invested in its operations to cash received as a result of its operations; equal to average inventory processing period plus average receivables collection period minus average payables payment period. Costco Wholesale Corp.’s cash conversion cycle improved from 2017 to 2018 and from 2018 to 2019.

Inventory Turnover

Costco Wholesale Corp., inventory turnover calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Sep 1, 2019 Sep 2, 2018 Sep 3, 2017 Aug 28, 2016 Aug 30, 2015 Aug 31, 2014
Selected Financial Data (US$ in millions)
Merchandise costs
Merchandise inventories
Short-term Activity Ratio
Inventory turnover1
Benchmarks
Inventory Turnover, Competitors2
Amazon.com Inc.
Home Depot Inc.
Lowe’s Cos. Inc.
Target Corp.
TJX Cos. Inc.
Walmart Inc.
Inventory Turnover, Sector
General Retailers
Inventory Turnover, Industry
Consumer Services

Based on: 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), 10-K (filing date: 2014-10-15).

1 2019 Calculation
Inventory turnover = Merchandise costs ÷ Merchandise inventories
= ÷ =

2 Click competitor name to see calculations.

Short-term activity ratio Description The company
Inventory turnover An activity ratio calculated as cost of goods sold divided by inventory. Costco Wholesale Corp.’s inventory turnover ratio deteriorated from 2017 to 2018 but then improved from 2018 to 2019 exceeding 2017 level.

Receivables Turnover

Costco Wholesale Corp., receivables turnover calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Sep 1, 2019 Sep 2, 2018 Sep 3, 2017 Aug 28, 2016 Aug 30, 2015 Aug 31, 2014
Selected Financial Data (US$ in millions)
Net sales
Receivables, net
Short-term Activity Ratio
Receivables turnover1
Benchmarks
Receivables Turnover, Competitors2
Amazon.com Inc.
Home Depot Inc.
Lowe’s Cos. Inc.
Target Corp.
TJX Cos. Inc.
Walmart Inc.
Receivables Turnover, Sector
General Retailers
Receivables Turnover, Industry
Consumer Services

Based on: 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), 10-K (filing date: 2014-10-15).

1 2019 Calculation
Receivables turnover = Net sales ÷ Receivables, net
= ÷ =

2 Click competitor name to see calculations.

Short-term activity ratio Description The company
Receivables turnover An activity ratio equal to revenue divided by receivables. Costco Wholesale Corp.’s receivables turnover ratio deteriorated from 2017 to 2018 but then improved from 2018 to 2019 exceeding 2017 level.

Payables Turnover

Costco Wholesale Corp., payables turnover calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Sep 1, 2019 Sep 2, 2018 Sep 3, 2017 Aug 28, 2016 Aug 30, 2015 Aug 31, 2014
Selected Financial Data (US$ in millions)
Merchandise costs
Accounts payable
Short-term Activity Ratio
Payables turnover1
Benchmarks
Payables Turnover, Competitors2
Amazon.com Inc.
Home Depot Inc.
Lowe’s Cos. Inc.
Target Corp.
TJX Cos. Inc.
Walmart Inc.
Payables Turnover, Sector
General Retailers
Payables Turnover, Industry
Consumer Services

Based on: 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), 10-K (filing date: 2014-10-15).

1 2019 Calculation
Payables turnover = Merchandise costs ÷ Accounts payable
= ÷ =

2 Click competitor name to see calculations.

Short-term activity ratio Description The company
Payables turnover An activity ratio calculated as cost of goods sold divided by payables. Costco Wholesale Corp.’s payables turnover ratio decreased from 2017 to 2018 but then increased from 2018 to 2019 not reaching 2017 level.

Working Capital Turnover

Costco Wholesale Corp., working capital turnover calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Sep 1, 2019 Sep 2, 2018 Sep 3, 2017 Aug 28, 2016 Aug 30, 2015 Aug 31, 2014
Selected Financial Data (US$ in millions)
Current assets
Less: Current liabilities
Working capital
 
Net sales
Short-term Activity Ratio
Working capital turnover1
Benchmarks
Working Capital Turnover, Competitors2
Amazon.com Inc.
Home Depot Inc.
Lowe’s Cos. Inc.
Target Corp.
TJX Cos. Inc.
Walmart Inc.
Working Capital Turnover, Sector
General Retailers
Working Capital Turnover, Industry
Consumer Services

Based on: 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), 10-K (filing date: 2014-10-15).

1 2019 Calculation
Working capital turnover = Net sales ÷ Working capital
= ÷ =

2 Click competitor name to see calculations.

Short-term activity ratio Description The company
Working capital turnover An activity ratio calculated as revenue divided by working capital. Costco Wholesale Corp.’s working capital turnover ratio improved from 2017 to 2018 and from 2018 to 2019.

Average Inventory Processing Period

Costco Wholesale Corp., average inventory processing period calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Sep 1, 2019 Sep 2, 2018 Sep 3, 2017 Aug 28, 2016 Aug 30, 2015 Aug 31, 2014
Selected Financial Data
Inventory turnover
Short-term Activity Ratio (no. days)
Average inventory processing period1
Benchmarks (no. days)
Average Inventory Processing Period, Competitors2
Amazon.com Inc.
Home Depot Inc.
Lowe’s Cos. Inc.
Target Corp.
TJX Cos. Inc.
Walmart Inc.
Average Inventory Processing Period, Sector
General Retailers
Average Inventory Processing Period, Industry
Consumer Services

Based on: 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), 10-K (filing date: 2014-10-15).

1 2019 Calculation
Average inventory processing period = 365 ÷ Inventory turnover
= 365 ÷ =

2 Click competitor name to see calculations.

Short-term activity ratio Description The company
Average inventory processing period An activity ratio equal to the number of days in the period divided by inventory turnover over the period. Costco Wholesale Corp.’s number of days of inventory outstanding deteriorated from 2017 to 2018 but then improved from 2018 to 2019 exceeding 2017 level.

Average Receivable Collection Period

Costco Wholesale Corp., average receivable collection period calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Sep 1, 2019 Sep 2, 2018 Sep 3, 2017 Aug 28, 2016 Aug 30, 2015 Aug 31, 2014
Selected Financial Data
Receivables turnover
Short-term Activity Ratio (no. days)
Average receivable collection period1
Benchmarks (no. days)
Average Receivable Collection Period, Competitors2
Amazon.com Inc.
Home Depot Inc.
Lowe’s Cos. Inc.
Target Corp.
TJX Cos. Inc.
Walmart Inc.
Average Receivable Collection Period, Sector
General Retailers
Average Receivable Collection Period, Industry
Consumer Services

Based on: 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), 10-K (filing date: 2014-10-15).

1 2019 Calculation
Average receivable collection period = 365 ÷ Receivables turnover
= 365 ÷ =

2 Click competitor name to see calculations.

Short-term activity ratio Description The company
Average receivable collection period An activity ratio equal to the number of days in the period divided by receivables turnover.

Operating Cycle

Costco Wholesale Corp., operating cycle calculation, comparison to benchmarks

No. days

Microsoft Excel LibreOffice Calc
Sep 1, 2019 Sep 2, 2018 Sep 3, 2017 Aug 28, 2016 Aug 30, 2015 Aug 31, 2014
Selected Financial Data
Average inventory processing period
Average receivable collection period
Short-term Activity Ratio
Operating cycle1
Benchmarks
Operating Cycle, Competitors2
Amazon.com Inc.
Home Depot Inc.
Lowe’s Cos. Inc.
Target Corp.
TJX Cos. Inc.
Walmart Inc.
Operating Cycle, Sector
General Retailers
Operating Cycle, Industry
Consumer Services

Based on: 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), 10-K (filing date: 2014-10-15).

1 2019 Calculation
Operating cycle = Average inventory processing period + Average receivable collection period
= + =

2 Click competitor name to see calculations.

Short-term activity ratio Description The company
Operating cycle Equal to average inventory processing period plus average receivables collection period. Costco Wholesale Corp.’s operating cycle deteriorated from 2017 to 2018 but then improved from 2018 to 2019 exceeding 2017 level.

Average Payables Payment Period

Costco Wholesale Corp., average payables payment period calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Sep 1, 2019 Sep 2, 2018 Sep 3, 2017 Aug 28, 2016 Aug 30, 2015 Aug 31, 2014
Selected Financial Data
Payables turnover
Short-term Activity Ratio (no. days)
Average payables payment period1
Benchmarks (no. days)
Average Payables Payment Period, Competitors2
Amazon.com Inc.
Home Depot Inc.
Lowe’s Cos. Inc.
Target Corp.
TJX Cos. Inc.
Walmart Inc.
Average Payables Payment Period, Sector
General Retailers
Average Payables Payment Period, Industry
Consumer Services

Based on: 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), 10-K (filing date: 2014-10-15).

1 2019 Calculation
Average payables payment period = 365 ÷ Payables turnover
= 365 ÷ =

2 Click competitor name to see calculations.

Short-term activity ratio Description The company
Average payables payment period An estimate of the average number of days it takes a company to pay its suppliers; equal to the number of days in the period divided by payables turnover ratio for the period.

Cash Conversion Cycle

Costco Wholesale Corp., cash conversion cycle calculation, comparison to benchmarks

No. days

Microsoft Excel LibreOffice Calc
Sep 1, 2019 Sep 2, 2018 Sep 3, 2017 Aug 28, 2016 Aug 30, 2015 Aug 31, 2014
Selected Financial Data
Average inventory processing period
Average receivable collection period
Average payables payment period
Short-term Activity Ratio
Cash conversion cycle1
Benchmarks
Cash Conversion Cycle, Competitors2
Amazon.com Inc.
Home Depot Inc.
Lowe’s Cos. Inc.
Target Corp.
TJX Cos. Inc.
Walmart Inc.
Cash Conversion Cycle, Sector
General Retailers
Cash Conversion Cycle, Industry
Consumer Services

Based on: 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), 10-K (filing date: 2014-10-15).

1 2019 Calculation
Cash conversion cycle = Average inventory processing period + Average receivable collection period – Average payables payment period
= + – =

2 Click competitor name to see calculations.

Short-term activity ratio Description The company
Cash conversion cycle A financial metric that measures the length of time required for a company to convert cash invested in its operations to cash received as a result of its operations; equal to average inventory processing period plus average receivables collection period minus average payables payment period. Costco Wholesale Corp.’s cash conversion cycle improved from 2017 to 2018 and from 2018 to 2019.