MMarketMath

COST

StalwartQuality: High (82/100)

Costco · Consumer Staples · Consumer Staples Merchandise Retail

$959.44

52w 844.06 – 1,096.50

20y monthly, adjusted

Mkt cap

$425.2B

P/E

45.5

P/FCF

44.8

FCF yield

2.2%

ROE

25.8%

Shldr yield

0.8%

div 0.6% + bb 0.2%

What today's price assumes

At $425.2B, the market is pricing in 18.7% annual free-cash-flow growth for the next decade (10% discount rate, 2.5% terminal growth). Over the last ten years, FCF actually grew 30.7% per year — expectations look undemanding relative to history.

Simple DCF per-share range: $323 · $724 · $1,043 (4% / base / optimistic growth). An estimate, not a target.

Adjust the assumptions yourself →

Historical multiple lens

At its own median P/OCF of 16.2× across 19 years, COST would trade near $577/share (25th–75th percentile: $359–$766); it trades at 26.9× today.

Assumes the historical multiple regime persists — re-ratings can be permanent.

Growth record

Compound annual growth rates from as-filed 10-K data, split-adjusted

Rev 3y

+7.8%

Rev 5y

+9.1%

Rev 10y

+9.8%

EPS 5y

+13.0%

EPS 10y

+14.6%

FCF 5y

+11.8%

FCF 10y

+30.7%

Fundamentals

Fiscal 2008–2026, from SEC filings

Revenue

2008: $72.5B
2009: $71.4B
2010: $77.9B
2011: $88.9B
2012: $99.1B
2013: $105.2B
2014: $112.6B
2015: $116.2B
2016: $118.7B
2017: $129.0B
2018: $141.6B
2019: $152.7B
2020: $166.8B
2021: $195.9B
2022: $227.0B
2023: $242.3B
2024: $254.5B
2025: $275.2B
2026: $303.2B
$0$100.0B$200.0B$300.0B
08
12
16
20
24

Net income

2008: $1.3B
2009: $1.1B
2010: $1.3B
2011: $1.5B
2012: $1.7B
2013: $2.0B
2014: $2.1B
2015: $2.4B
2016: $2.4B
2017: $2.7B
2018: $3.1B
2019: $3.7B
2020: $4.0B
2021: $5.0B
2022: $5.8B
2023: $6.3B
2024: $7.4B
2025: $8.1B
2026: $9.2B
$0$2.5B$5.0B$7.5B
08
12
16
20
24

Free cash flow

2008: $607.0M
2009: $842.0M
2010: $1.7B
2011: $1.9B
2012: $1.6B
2013: $1.4B
2014: $2.0B
2015: $1.9B
2016: $643.0M
2017: $4.2B
2018: $2.8B
2019: $3.4B
2020: $6.1B
2021: $5.4B
2022: $3.5B
2023: $6.7B
2024: $6.6B
2025: $7.8B
2026: $9.4B
$0$2.5B$5.0B$7.5B
08
12
16
20
24

Diluted shares (lower is better)

2008: 444.2M
2009: 440.5M
2010: 446.0M
2011: 443.1M
2012: 439.4M
2013: 440.5M
2014: 442.5M
2015: 442.7M
2016: 441.3M
2017: 440.9M
2018: 441.8M
2019: 442.9M
2020: 443.9M
2021: 444.3M
2022: 444.8M
2023: 444.5M
2024: 444.8M
2025: 444.8M
2026: 444.4M
0200.0M400.0M
08
12
16
20
24

Margins

0%5%10%08111417202326
Net marginFCF marginGross margin

Capital returned (dividends + buybacks)

2008: $1.2B
2009: $365.0M
2010: $889.0M
2011: $1.0B
2012: $1.1B
2013: $3.6B
2014: $918.0M
2015: $3.3B
2016: $1.2B
2017: $4.4B
2018: $1.0B
2019: $1.3B
2020: $1.7B
2021: $6.2B
2022: $1.9B
2023: $1.9B
2024: $9.7B
2025: $3.1B
2026: $3.3B
$0$2.5B$5.0B$7.5B
08
12
16
20
24

Cash vs long-term debt

$0$10.0B$20.0B08111417202326
CashLT debt

Quarterly

Discrete quarters from 10-Q filings; Q4 derived as fiscal year minus Q1–Q3. OCF is unwound from the year-to-date figures 10-Qs report. Compare to the same quarter a year ago — most businesses are seasonal.

Revenue by quarter

Q4'23: $78.9B
Q1'24: $57.8B
Q2'24: $58.4B
Q3'24: $58.5B
Q4'24: $79.7B
Q1'25: $62.2B
Q2'25: $63.7B
Q3'25: $63.2B
Q4'25: $86.2B
Q1'26: $67.3B
Q2'26: $69.6B
Q3'26: $70.5B
Q4'26: $95.7B
$0$25.0B$50.0B$75.0B
23
24
25
26
26

Net income by quarter

Q4'23: $2.2B
Q1'24: $1.6B
Q2'24: $1.7B
Q3'24: $1.7B
Q4'24: $2.4B
Q1'25: $1.8B
Q2'25: $1.8B
Q3'25: $1.9B
Q4'25: $2.6B
Q1'26: $2.0B
Q2'26: $2.0B
Q3'26: $2.2B
Q4'26: $3.0B
$0$1.0B$2.0B$3.0B
23
24
25
26
26
QuarterRevenueYoYNet incomeYoYEPSOCF
Q4'26 *$95.7B+11.1%$3.0B+14.9%6.75—
Q3'26$70.5B+11.6%$2.2B+15.2%4.93—
Q2'26$69.6B+9.2%$2.0B+13.8%4.58—
Q1'26$67.3B+8.3%$2.0B+11.3%4.50$4.7B
Q4'25 *$86.2B+8.1%$2.6B+10.9%5.87—
Q3'25$63.2B+8.0%$1.9B+13.2%4.28—
Q2'25$63.7B+9.0%$1.8B+2.6%4.02—
Q1'25$62.2B+7.5%$1.8B+13.2%4.04$3.3B
Q4'24 *$79.7B+1.0%$2.4B+9.0%5.28—
Q3'24$58.5B+9.1%$1.7B+29.1%3.78—
Q2'24$58.4B+5.7%$1.7B+18.9%3.92—
Q1'24$57.8B+6.2%$1.6B+16.5%3.58$4.7B
Q4'23 *$78.9B+9.5%$2.2B+15.6%4.86—

Track record

Compound annual growth by period. For debt and share count, negative is the good direction.

Series3y5y10y15y
Revenue+7.8%+9.1%+9.8%+8.5%
Operating cash flow+12.6%+12.0%+17.0%+11.2%
Free cash flow+11.6%+11.8%+30.7%+11.2%
EPS (diluted)+13.6%+13.0%+14.6%+13.0%
Equity+12.6%+15.3%+11.5%+7.6%
LT debt−10.0%−10.2%−0.4%+7.9%
Diluted shares−0.0%+0.0%+0.1%+0.0%
Stock price+21.8%+15.5%+22.6%+20.3%

$100, 3 years ago

$181vs $192 in SPY

21.8% vs 24.4%/yr

$100, 5 years ago

$206vs $181 in SPY

15.5% vs 12.6%/yr

$100, 10 years ago

$768vs $428 in SPY

22.6% vs 15.6%/yr

$100, 15 years ago

$1,595vs $803 in SPY

20.3% vs 14.9%/yr

The $1 test — market value created per $1 of earnings retained (Buffett's hurdle: at least $1)

Last 5 years

$10.56

$215.4B created / $20.4B retained

Last 10 years

$13.36

$347.7B created / $26.0B retained

Quality & capital discipline

Cash-based returns and how management deploys capital

Cash ROIC

39.8%

OCF ÷ (equity + debt)

OCF / EV yield

3.9%

MC vs 10× OCF

2.65

≤1 = priced under 10× OCF

Debt / FCF

0.4y

SBC / FCF

9.8%

Owner earnings

$8.5B

OCF − capex − SBC

OE yield

2.0%

Share count 5y

+0.0%

per year; negative = buybacks

Capital intensity

11.8%

net PP&E ÷ revenue

Sales efficiency

$0.11

new PP&E per $1 new revenue, 5y

Growth engine (5y): reinvested 11.0% of operating cash flow at an incremental return of 105.3% — an organically fundable growth rate of about 11.6% per year (growth ≈ reinvestment rate × incremental ROIC).

Checklist

20 of 26 checks pass · 77%. Checks with structurally missing inputs are excluded.

Growth & Consistency

7/7

  • Revenue growth

    9.1% · 5y CAGR ≥ 5%

    pass

  • EPS growth

    13.0% · 5y CAGR ≥ 5%

    pass

  • FCF growth

    11.8% · 5y CAGR ≥ 5%

    pass

  • Revenue rises consistently

    9 of 9 · up in ≥ 7 of last 10 years

    pass

  • FCF consistently positive

    10 of 10 · positive in ≥ 8 of last 10 years

    pass

  • Profitable every year

    10 of 10 · net income > 0 in ≥ 8 of last 10

    pass

  • Cash flow keeps up with sales

    12.0% vs 9.1% · OCF CAGR ≥ 0.9× revenue CAGR

    pass

Profitability

3/6

  • Net margin

    3.0% · ≥ 8%

    fail

  • Operating margin

    3.9% · ≥ 10%

    fail

  • Gross margin stable or rising

    — · no drop > 2 pts over 3y

    na

  • Return on equity

    25.8% · ≥ 12%

    pass

  • Cash ROIC

    39.8% · ≥ 12%

    pass

  • FCF margin

    3.1% · ≥ 5%

    fail

  • Earnings back their cash

    OCF $15.8B vs NI $9.2B · OCF ≥ net income (latest FY)

    pass

Balance Sheet

5/5

  • Debt payable from cash flow

    0.4y · LT debt ≤ 3× FCF

    pass

  • Cash cushion

    516% · cash ≥ 50% of LT debt

    pass

  • Leverage

    0.11 · LT debt ≤ 1.5× equity

    pass

  • Equity positive and compounding

    $35.8B · equity > 0 and grew over ~5y

    pass

  • Interest burden

    1% · interest ≤ 15% of operating income

    pass

Capital Allocation

4/4

  • Share count flat or shrinking

    0.0% · ≤ +0.5%/yr over ~5y

    pass

  • Stock comp restrained

    10% · SBC ≤ 15% of FCF

    pass

  • Distributions funded by FCF

    35% · dividends + buybacks ≤ 100% of FCF

    pass

  • Repurchases are a habit

    10 of 10 · buybacks in ≥ 5 of last 10 years

    pass

Valuation Discipline

1/4

  • FCF yield

    2.2% · ≥ 3%

    fail

  • Earnings multiple

    45.5 · P/E ≤ 25

    fail

  • Price asks less than history delivered

    18.7% vs 30.7% · implied FCF growth ≤ historical FCF CAGR

    pass

  • Shareholder yield

    0.8% · dividends + buybacks ≥ 2% of market cap

    fail

Financial data

As filed in 10-Ks; per-share figures split-adjusted. $ in millions.

FYRevenueGross profitOp incomeNet incomeEPSOCFCapExFCFDividendsBuybacksSBCCashLT debtEquityShares
2026303,154—11,6859,22620.7615,8176,4359,3822,45884892420,2073,91435,803444
2025275,235—10,3838,09918.2113,3355,4987,8372,18390386014,1615,71329,164445
2024254,453—9,2857,36716.5611,3394,7106,6299,0417008189,9065,79423,622445
2023242,290—8,1146,29214.1611,0684,3236,7451,25167677413,7005,37725,058444
2022226,954—7,7935,84413.147,3923,8913,5011,49843972410,2036,48420,642445
2021195,929—6,7085,00711.278,9583,5885,3705,74849666511,2586,69217,564444
2020166,761—5,4354,0029.028,8612,8106,0511,47919661912,2777,51418,284444
2019152,70316,4654,7373,6598.266,3562,9983,3581,0382475958,3845,12415,243443
2018141,576—4,4803,1347.095,7742,9692,8056893285446,0556,48712,799442
2017129,025—4,1112,6796.086,7262,5024,2243,9044695144,5466,57310,778441
2016118,719—3,6722,3505.333,2922,6496437464864593,3794,06112,079441
2015116,199—3,6242,3775.374,2852,3931,8922,8654813944,8014,85210,617443
2014112,640—3,2202,0584.653,9841,9931,9915843343275,7385,09312,303442
2013105,156—3,0532,0394.633,4372,0831,3543,560362854,6444,99810,833441
201299,137—2,7591,7093.893,0571,4801,5774466322413,5281,38112,361439
201188,915—2,4391,4623.303,1981,2901,9083896242074,0091,25312,002443
201077,946—2,0771,3032.922,7801,0551,7253385511903,2142,14110,829446
200971,422—1,7771,0862.472,0921,250842296691813,1572,13010,024440
200872,483—1,9691,2832.892,2061,5996072658951662,619—9,274444

Some concepts are structurally absent for certain industries (banks report no gross profit or capex). Missing ≠ zero.

Compare with peers →·10-K filings on EDGAR ↗