- Major brick-and-mortar retailers continue to fight for shrinking market share, but still represent over 90 percent of the retail market.
- Walmart remains an industry leader, but Costco boasts faster growth rates.
- Both companies are rapidly expanding their online footprints.
- Walmart’s lower P/S ratio and forward P/E could indicate it’s the better value buy.
- The dividend yield of 2.19 percent is more than double that of Costco’s 1 percent.
- With about half a trillion dollars in sales in 2018, Walmart remains the world’s largest retailer.
- Walmart has posted four straight years of declining profits.
- Costco posted over triple the revenue growth of Walmart for 2018 and saw its stock gain 42 percent in the last 12 months compared to 10.9 percent for Walmart.
- Costco’s profit margins of 2.21 percent are better than double Walmart’s 1.02 percent.
- The return on equity of 26.29 percent would indicate management is leveraging assets efficiently.
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As Sears files for bankruptcy and stock in Amazon is caught up in a major downswing, both the future and the past of American retail is struggling at the moment. Given that online sales still represent less than 10 percent of total retail sales, however, plenty of investors might be wondering which old-school box store is the better investment.
So, here’s a look at two of the biggest players in the market: the world’s biggest retailer, Walmart (WMT), versus the poster child for buying in bulk, Costco (COST).
Walmart vs. Costco Stock Comparison
Here’s a basic comparison of Walmart and Costco stocks:
|Market Cap||$274.8 billion||$98.4 billion|
|2018 Revenue*||$500.3 billion||$141.6 billion|
|2018 Profits*||$9.9 billion||$3.1 billion|
|2018 Revenue Growth*||3%||9.7%|
|2018 Profit Growth*||-27.7%||17%|
|GOBankingRates’ Evaluation||$389.2 billion||$91.6 billion|
|Stock Gain/Loss Last Month||-0.8%||-4.6%|
|Stock Gain/Loss Last Year||10.9%||42%|
|*Walmart’s 2018 fiscal year ended on Jan. 31, 2018; Costco’s ended on Sept. 2, 2018.|
Why You Might Pick Walmart Stock:
Why You Might Pick Costco Stock:
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The Final Word on WMT vs. COST
Walmart is the biggest retailer in the world, booking over half a trillion dollars in sales for its 2018 fiscal year and offering a healthy dividend, but Costco is growing at a much faster rate. However, whichever company you think is more likely to win the race to capture online sales might be the horse to back for the long run.
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This article is produced for informational purposes only and is not a recommendation to buy or sell any securities. Investing comes with risk to loss of principal. Always conduct your own research and consider your investment decisions carefully.