InvestorsObserver gives Costco Wholesale Corporation (COST) a weak valuation score of 16 from its analysis. The proprietary scoring system considers the underlying health of a company by analyzing its stock price, earnings, and growth rate. COST currently holds a better value than 16% of stocks based on these metrics. Long term investors focused on buying-and-holding should find the valuation ranking system most relevant when making investment decisions.
COST gets a 16 Valuation Rank today. Find out what this means to you and get the rest of the rankings on COST!
COST has a trailing twelve month Price to Earnings (PE) ratio of 25.3. The historical average of roughly 15 shows a poor value for COST stock as investors are paying higher share prices relative to the company's earnings. COST's high trailing PE ratio shows that the firm has been trading above its fair market value recently. Its trailing 12-month earnings per share (EPS) of 18.15 does not justify the stock's current price. However, trailing PE ratios do not factor in the company's projected growth rate, resulting in many newer firms having high PE ratios due to high growth potential enticing investors despite inadequate earnings.
COST has a 12 month forward PE to Growth (PEG) ratio of 4.33. Markets are overvaluing COST in relation to its projected growth as its PEG ratio is currently above the fair market value of 1. 18.1499996's PEG comes from its forward price to earnings ratio being divided by its growth rate. PEG ratios are one of the most used valuation metrics due to its incorporation of more company fundamentals metrics and a focus on the firm's future rather than its past.
