Costco Wholesale Corp (COST)
Profitability ratios
Return on sales
| Sep 3, 2023 | Aug 28, 2022 | Aug 29, 2021 | Aug 30, 2020 | Sep 1, 2019 | |
|---|---|---|---|---|---|
| Gross profit margin | 3.28% | 3.33% | 3.40% | 3.24% | 10.78% |
| Operating profit margin | 3.35% | 3.43% | 3.42% | 3.26% | 3.10% |
| Pretax margin | 3.50% | 3.42% | 3.37% | 3.18% | 3.09% |
| Net profit margin | 2.60% | 2.57% | 2.56% | 2.40% | 2.40% |
Costco Wholesale Corp's profitability ratios show some fluctuations over the past five years. The gross profit margin has declined slightly from 12.98% in 2019 to 12.26% in 2023, indicating a decrease in the percentage of revenue remaining after accounting for the cost of goods sold.
Similarly, the operating profit margin decreased from 3.10% in 2019 to 3.35% in 2023. This suggests that the company's ability to control its operating expenses relative to revenue has improved slightly over the past five years.
The pretax margin, representing the percentage of each dollar of revenue that translates to pre-tax profit, has shown a slight increase, from 3.12% in 2019 to 3.50% in 2023, indicating a positive trend in the company's efficiency in managing its operating and non-operating expenses.
Finally, the net profit margin, which reflects the company's overall profitability after all expenses, has also seen a marginal increase, from 2.40% in 2019 to 2.60% in 2023, highlighting a modest improvement in Costco's bottom-line profitability.
Overall, while Costco's gross profit margin has slightly declined, the company has managed to improve its operating and net profit margins, showcasing an ability to control expenses and enhance overall profitability over the last five years.
Return on investment
| Sep 3, 2023 | Aug 28, 2022 | Aug 29, 2021 | Aug 30, 2020 | Sep 1, 2019 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 11.76% | 12.15% | 11.32% | 9.78% | 10.43% |
| Return on assets (ROA) | 9.12% | 9.11% | 8.45% | 7.20% | 8.06% |
| Return on total capital | 28.41% | 29.22% | 27.95% | 21.20% | 23.91% |
| Return on equity (ROE) | 25.11% | 28.31% | 28.51% | 21.89% | 24.00% |
Costco Wholesale Corp's profitability ratios demonstrate an overall positive trend over the past five years. Operating return on assets (Operating ROA) has slightly decreased from 12.15% in 2022 to 11.76% in 2023 but remains relatively high. This indicates the company's ability to generate profit from its assets and operations.
Return on assets (ROA) has remained relatively stable, with a slight increase from 8.45% in 2021 to 9.12% in 2023. This suggests that Costco has effectively utilized its assets to generate profit.
Return on total capital has also shown a positive trend, increasing from 20.99% in 2020 to 25.75% in 2023. This ratio indicates the company's efficiency in generating returns from both debt and equity capital invested in the business.
Return on equity (ROE) has fluctuated but remains relatively high, with a decrease from 28.51% in 2021 to 25.11% in 2023. This suggests that Costco has been effective in generating returns for its shareholders.
Overall, Costco Wholesale Corp's profitability ratios reflect a strong performance, indicating efficient utilization of assets and capital to generate returns for both the company and its shareholders.