5-Star Stocks Poised to Pop: Costco
Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, discount-warehouse giant Costco Wholesale (NAS: COST) has earned a coveted five-star ranking.
With that in mind, let's take a closer look at Costco's business and see what CAPS investors are saying about the stock right now.
Costco facts
Headquarters (Founded) | Issaquah, Wash. (1976) |
Market Cap | $37.0 billion |
Industry | Hypermarkets and supercenters |
Trailing-12-Month Revenue | $88.9 billion |
Management | Co-Founder/CEO James Sinegal |
Return on Equity (Average, Past 3 Years) | 12.3% |
Cash/Debt | $5.61 billion / $2.32 billion |
Dividend Yield | 1.1% |
Competitors |
Sources: S&P Capital IQ and Motley Fool CAPS.
On CAPS, 96% of the 4,320 members who have rated Costco believe the stock will outperform the S&P 500 going forward. These bulls include LegendPhoenix and Raylanw.
This past summer, LegendPhoenix tapped Costco as an established way to go for growth: "This no-frills, low-cost, bulk-shopping model has done well in the US and Costco has begun expanding their stores internationally. I like Costco's core values and I think they should lead them to succeed wherever they may grow."
Over the next five years, in fact, Costco is expected to grow its bottom line at a solid rate of 13% annually. That's slightly faster than competitors like Kroger (11%), Target (11%), and Wal-Mart (10%).
CAPS member Raylanw elaborates on the Costco bull case:
This company will always do well no matter what market it's in. You purchase things in bulk, and it's much cheaper in such a fashion. Not to mention the cheap food and samples! With US sales stagnant, foreign penetration is key right now and they seem to be doing well on that front. They are still a long way away from saturating the foreign market so I can see some nice room for growth. Stalwart and on my watchlist.
What do you think about Costco, or any other stock for that matter? If you want to retire rich, you need to put together the best portfolio you can. Owning exceptional stocks is a surefire way to secure your financial future, and on Motley Fool CAPS, thousands of investors are working every day to find them. CAPS is 100% free, so get started!
Interested in another easy way to trackCostco?Add it to your watchlist.
At the time thisarticle was published Fool contributor Brian Pacampara owns no position in any of the companies mentioned. The Fool owns shares of Costco and Wal-Mart. Motley Fool newsletter services have recommended buying shares of Costco and Wal-Mart, as well as creating a diagonal call position in Wal-Mart. Try any of our Foolish newsletter services free for 30 days.We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Fool's disclosure policy always gets a perfect score.
Copyright © 1995 - 2011 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.
