COST vs. WMT, PSMT, TGT, DG, DLTR, BJ, FIVE, OLLI, BIG, and HD
Should you be buying Costco Wholesale stock or one of its competitors? The main competitors of Costco Wholesale include Walmart (WMT), PriceSmart (PSMT), Target (TGT), Dollar General (DG), Dollar Tree (DLTR), BJ's Wholesale Club (BJ), Five Below (FIVE), Ollie's Bargain Outlet (OLLI), Big Lots (BIG), and Home Depot (HD).
Costco Wholesale (NASDAQ:COST) and Walmart (NYSE:WMT) are both large-cap retail/wholesale companies, but which is the superior business? We will compare the two companies based on the strength of their earnings, valuation, analyst recommendations, media sentiment, risk, community ranking, dividends, profitability and institutional ownership.
In the previous week, Costco Wholesale had 45 more articles in the media than Walmart. MarketBeat recorded 101 mentions for Costco Wholesale and 56 mentions for Walmart. Costco Wholesale's average media sentiment score of 0.62 beat Walmart's score of 0.48 indicating that Costco Wholesale is being referred to more favorably in the media.
68.5% of Costco Wholesale shares are held by institutional investors. Comparatively, 26.8% of Walmart shares are held by institutional investors. 0.2% of Costco Wholesale shares are held by insiders. Comparatively, 45.6% of Walmart shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.
Costco Wholesale pays an annual dividend of $4.64 per share and has a dividend yield of 0.6%. Walmart pays an annual dividend of $0.83 per share and has a dividend yield of 1.3%. Costco Wholesale pays out 30.3% of its earnings in the form of a dividend. Walmart pays out 35.5% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years.
Walmart has higher revenue and earnings than Costco Wholesale. Walmart is trading at a lower price-to-earnings ratio than Costco Wholesale, indicating that it is currently the more affordable of the two stocks.
Costco Wholesale has a beta of 0.77, indicating that its stock price is 23% less volatile than the S&P 500. Comparatively, Walmart has a beta of 0.49, indicating that its stock price is 51% less volatile than the S&P 500.
Costco Wholesale received 322 more outperform votes than Walmart when rated by MarketBeat users. Likewise, 71.91% of users gave Costco Wholesale an outperform vote while only 60.39% of users gave Walmart an outperform vote.
Costco Wholesale currently has a consensus price target of $743.52, suggesting a potential downside of 8.20%. Walmart has a consensus price target of $68.01, suggesting a potential upside of 3.42%. Given Walmart's stronger consensus rating and higher possible upside, analysts clearly believe Walmart is more favorable than Costco Wholesale.
Walmart has a net margin of 2.88% compared to Costco Wholesale's net margin of 2.73%. Costco Wholesale's return on equity of 28.80% beat Walmart's return on equity.
Summary
Costco Wholesale beats Walmart on 12 of the 20 factors compared between the two stocks.
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This chart shows the number of new MarketBeat users adding COST and its top 5 competitors to their watchlist. Each company is represented with a line over a 90 day period.
This chart shows the average media sentiment of NASDAQ and its competitors over the past 90 days as caculated by MarketBeat. The averaged score is equivalent to the following: Very Negative Sentiment <= -1.5, Negative Sentiment > -1.5 and <= -0.5, Neutral Sentiment > -0.5 and < 0.5, Positive Sentiment >= 0.5 and < 1.5, and Very Positive Sentiment >= 1.5.
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