Costco Wholesale Corporation (COST) vs PriceSmart, Inc. (PSMT)

Costco Wholesale Corporation and PriceSmart, Inc. are both Discount Stores companies. Costco Wholesale Corporation is the larger, with a market value of $396.7B against $5.3B — 74.3× the size. PriceSmart, Inc. trades at the lower P/E: 33.5× against 46.3×. PriceSmart, Inc. grew revenue faster over the last twelve months: 10.2% against 9.23%. Costco Wholesale Corporation has the higher net margin (3.01% vs 2.77%) and the higher return on invested capital (36.6% vs 12.9%). Both pay a dividend; Costco Wholesale Corporation yields more (2.58% vs 1.26%). Across the 23 metrics below, Costco Wholesale Corporation leads on 12 and PriceSmart, Inc. on 11.

Valuation

Metric COST PSMT Discount Stores median
P/E 46.30 33.54 19.55
P/S 1.39 0.93 1.08
P/B 12.21 3.79 5.43
Price to free cash flow 46.47 64.15 33.31
EV/EBITDA 28.65 14.56 12.17
EV/Sales 1.35 0.90 1.06
Earnings yield 2.16% 2.98% 3.95%
Free cash flow yield 2.15% 1.56% 2.93%

Profitability

Metric COST PSMT Discount Stores median
Gross margin 12.88% 17.63% 27.27%
Operating margin 3.82% 4.51% 4.45%
Net margin 3.01% 2.77% 3.01%
Free cash flow margin 3.00% 1.45% 3.30%
Return on equity 29.15% 12.08% 20.83%
Return on assets 10.92% 6.75% 7.60%
Return on invested capital 36.57% 12.91% 13.21%

Growth

Metric COST PSMT Discount Stores median
Revenue growth (TTM) 9.23% 10.18% 8.64%
EPS growth (last fiscal year) 9.96% 5.47% —
Revenue growth, 5-year CAGR 10.54% 9.62% 4.99%
Net income growth, 5-year CAGR 15.14% 13.15% 0.00%

Health

Metric COST PSMT Discount Stores median
Debt to equity 0.17 0.13 0.39
Current ratio 1.07 1.28 1.03
Net debt to EBITDA (0.75) (0.39) 0.59

Dividend

Metric COST PSMT Discount Stores median
Dividend yield 2.58% 1.26% 2.12%
Payout ratio 0.28 0.24 0.24

Size

Metric COST PSMT Discount Stores median
Market cap 396.68b 5.34b 16.44b

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