Costco Wholesale Corp (COST)

Activity ratios

Short-term

Turnover ratios

	Sep 1, 2024	May 12, 2024	Feb 18, 2024	Nov 26, 2023	Sep 3, 2023	May 7, 2023	Feb 12, 2023	Nov 20, 2022	Aug 28, 2022	May 8, 2022	Feb 13, 2022	Nov 21, 2021	Aug 29, 2021	May 9, 2021	Feb 14, 2021	Nov 22, 2020	Aug 30, 2020	May 10, 2020	Feb 16, 2020	Nov 24, 2019
Inventory turnover	13.15	14.05	14.10	13.21	14.10	13.98	14.10	12.03	12.25	8.50	8.65	8.02	9.07	12.90	12.46	11.22	13.18	13.83	12.42	10.19
Receivables turnover	93.51	98.22	89.54	96.64	106.04	94.10	86.36	99.93	101.27	109.26	94.18	105.12	108.67	117.01	92.36	105.06	107.59	106.75	79.65	90.40
Payables turnover	12.63	12.99	13.76	11.68	13.43	13.54	13.82	12.18	12.29	8.49	8.34	6.95	7.92	11.60	12.01	9.82	11.38	14.08	13.29	9.75
Working capital turnover	—	—	—	74.17	105.53	91.22	129.21	213.32	325.15	187.05	206.10	399.77	3,061.39	—	—	—	50.90	65.00	157.09	409.19

Costco Wholesale Corp's activity ratios provide insights into the efficiency of its operations in managing its inventory, receivables, payables, and working capital.

1. Inventory Turnover:
- Costco's inventory turnover has been consistently high, ranging from 8.02 to 14.10 times over the past few years.
- The high turnover indicates that Costco is managing its inventory efficiently by quickly selling and restocking its goods.

2. Receivables Turnover:
- Costco's receivables turnover has been relatively stable, ranging from 86.36 to 117.01 times.
- The company collects its receivables efficiently, indicating prompt payment by customers and effective credit management.

3. Payables Turnover:
- Costco's payables turnover has fluctuated between 6.95 and 14.08 times.
- The turnover indicates that Costco is managing its payables effectively, possibly by taking advantage of trade credit terms without jeopardizing supplier relationships.

4. Working Capital Turnover:
- The working capital turnover has shown significant variability, with notable peaks and troughs over the years.
- High turnover values suggest that Costco is effectively utilizing its working capital to generate sales, indicating efficient management of current assets and liabilities.

Overall, Costco's consistent inventory turnover, stable receivables turnover, fluctuating payables turnover, and varying working capital turnover demonstrate the company's focus on efficient operational activities and financial management practices.

Average number of days

		Sep 1, 2024	May 12, 2024	Feb 18, 2024	Nov 26, 2023	Sep 3, 2023	May 7, 2023	Feb 12, 2023	Nov 20, 2022	Aug 28, 2022	May 8, 2022	Feb 13, 2022	Nov 21, 2021	Aug 29, 2021	May 9, 2021	Feb 14, 2021	Nov 22, 2020	Aug 30, 2020	May 10, 2020	Feb 16, 2020	Nov 24, 2019
Days of inventory on hand (DOH)	days	27.75	25.98	25.88	27.63	25.89	26.12	25.89	30.34	29.79	42.95	42.20	45.50	40.25	28.29	29.30	32.54	27.70	26.40	29.39	35.81
Days of sales outstanding (DSO)	days	3.90	3.72	4.08	3.78	3.44	3.88	4.23	3.65	3.60	3.34	3.88	3.47	3.36	3.12	3.95	3.47	3.39	3.42	4.58	4.04
Number of days of payables	days	28.90	28.09	26.52	31.25	27.18	26.96	26.42	29.98	29.69	43.02	43.75	52.53	46.09	31.46	30.39	37.16	32.06	25.92	27.46	37.42

Costco Wholesale Corp's activity ratios provide insight into how efficiently the company manages its inventory, collects receivables, and pays its suppliers.

1. Days of Inventory on Hand (DOH): Costco's average inventory turnover has been relatively consistent over the periods analyzed, ranging from around 25 to 30 days. This indicates that the company manages its inventory efficiently, with a quick turnover rate. However, there was a noticeable increase in DOH in the most recent period compared to historical levels, which may require further investigation.

2. Days of Sales Outstanding (DSO): Costco's DSO has also remained relatively stable, fluctuating between 3 to 4 days. This suggests that the company has effective credit and collection policies in place, allowing it to collect payments from customers quickly.

3. Number of Days of Payables: Costco's payables turnover has been consistent, with the number of days of payables fluctuating within a certain range over the periods analyzed. A higher number of days of payables indicates that the company takes longer to pay its suppliers, potentially benefiting from extended payment terms.

Overall, Costco Wholesale Corp demonstrates efficient management of its inventory, receivables, and payables, reflecting its strong operational performance and effective working capital management strategies.

Long-term

	Sep 1, 2024	May 12, 2024	Feb 18, 2024	Nov 26, 2023	Sep 3, 2023	May 7, 2023	Feb 12, 2023	Nov 20, 2022	Aug 28, 2022	May 8, 2022	Feb 13, 2022	Nov 21, 2021	Aug 29, 2021	May 9, 2021	Feb 14, 2021	Nov 22, 2020	Aug 30, 2020	May 10, 2020	Feb 16, 2020	Nov 24, 2019
Fixed asset turnover	8.76	9.04	9.02	9.04	9.08	9.08	9.11	9.19	9.21	9.01	8.74	8.50	8.34	8.05	7.93	7.76	7.65	7.47	7.37	7.28
Total asset turnover	3.64	3.74	3.75	3.33	3.51	3.53	3.51	3.50	3.54	3.41	3.33	3.17	3.31	3.26	3.25	2.87	3.00	3.11	3.25	3.01

Costco Wholesale Corp's long-term activity ratios show stable and strong performance over the periods analyzed. The fixed asset turnover has been consistently high, ranging from 7.28 to 9.21, indicating that the company efficiently utilizes its fixed assets to generate sales. This suggests effective management of its property, plant, and equipment to drive revenue.

Furthermore, the total asset turnover ratio has also been robust, varying between 2.87 and 3.75. This indicates that Costco effectively leverages its total assets to generate sales, highlighting the company's ability to efficiently utilize all its assets.

Overall, the consistent high values of both the fixed asset turnover and total asset turnover ratios suggest that Costco Wholesale Corp effectively manages its assets to generate revenue, demonstrating strong operational efficiency and effective asset management practices over the periods analyzed.