PriceSmart, Inc. (PSMT) vs Target Corporation (TGT)

PriceSmart, Inc. and Target Corporation are both Discount Stores companies. Target Corporation is the larger, with a market value of $72.5B against $5.3B — 13.6× the size. Target Corporation trades at the lower P/E: 16.3× against 33.5×. PriceSmart, Inc. grew revenue faster over the last twelve months: 10.2% against 1.95%. Target Corporation has the higher net margin (4.08% vs 2.77%) and the higher return on invested capital (13.6% vs 12.9%). Both pay a dividend; Target Corporation yields more (2.91% vs 1.26%). Across the 23 metrics below, Target Corporation leads on 15 and PriceSmart, Inc. on 8.

Valuation

Metric PSMT TGT Discount Stores median
P/E 33.54 16.27 19.55
P/S 0.93 0.66 1.08
P/B 3.79 4.01 5.43
Price to free cash flow 64.15 16.06 33.31
EV/EBITDA 14.56 8.86 12.17
EV/Sales 0.90 0.76 1.06
Earnings yield 2.98% 6.15% 3.95%
Free cash flow yield 1.56% 6.23% 2.93%

Profitability

Metric PSMT TGT Discount Stores median
Gross margin 17.63% 29.30% 27.27%
Operating margin 4.51% 5.59% 4.45%
Net margin 2.77% 4.08% 3.01%
Free cash flow margin 1.45% 4.14% 3.30%
Return on equity 12.08% 26.41% 20.83%
Return on assets 6.75% 7.38% 7.60%
Return on invested capital 12.91% 13.55% 13.21%

Growth

Metric PSMT TGT Discount Stores median
Revenue growth (TTM) 10.18% 1.95% 8.64%
EPS growth (last fiscal year) 5.47% (8.24%) —
Revenue growth, 5-year CAGR 9.62% 2.29% 4.99%
Net income growth, 5-year CAGR 13.15% (3.24%) 0.00%

Health

Metric PSMT TGT Discount Stores median
Debt to equity 0.13 0.86 0.39
Current ratio 1.28 0.99 1.03
Net debt to EBITDA (0.39) 1.33 0.59

Dividend

Metric PSMT TGT Discount Stores median
Dividend yield 1.26% 2.91% 2.12%
Payout ratio 0.24 0.59 0.24

Size

Metric PSMT TGT Discount Stores median
Market cap 5.34b 72.51b 16.44b

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