Costco Wholesale Corp (COST)
Return on total capital
| 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 | Sep 1, 2019 | May 12, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 9,248,000 | 8,987,000 | 8,647,000 | 8,182,000 | 8,218,000 | 8,017,000 | 7,927,000 | 7,692,000 | 7,526,000 | 7,049,000 | 6,779,000 | 6,365,000 | 5,874,000 | 5,830,000 | 5,470,000 | 5,089,000 | 5,051,000 | 4,993,000 | 4,870,000 | 4,833,000 |
| Long-term debt | US$ in thousands | 5,865,000 | 5,866,000 | 5,377,000 | 6,497,000 | 6,506,000 | 6,472,000 | 6,484,000 | 6,507,000 | 6,658,000 | 6,667,000 | 6,692,000 | 7,495,000 | 7,522,000 | 7,529,000 | 7,514,000 | 7,598,000 | 5,099,000 | 5,107,000 | 5,124,000 | 4,799,000 |
| Total stockholders’ equity | US$ in thousands | 20,760,000 | 26,147,000 | 25,058,000 | 23,568,000 | 22,794,000 | 21,471,000 | 20,642,000 | 19,968,000 | 19,418,000 | 18,463,000 | 17,564,000 | 16,482,000 | 15,652,000 | 14,860,000 | 18,284,000 | 16,802,000 | 16,614,000 | 15,861,000 | 15,243,000 | 14,486,000 |
| Return on total capital | 34.73% | 28.07% | 28.41% | 27.21% | 28.05% | 28.69% | 29.22% | 29.05% | 28.86% | 28.05% | 27.95% | 26.55% | 25.35% | 26.04% | 21.20% | 20.86% | 23.26% | 23.81% | 23.91% | 25.06% |
February 18, 2024 calculation
Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $9,248,000K ÷ ($5,865,000K + $20,760,000K)
= 34.73%
Costco Wholesale Corp's return on total capital has exhibited a generally positive trend over the provided time period, ranging from a low of 20.86% in August 2020 to a high of 34.73% in February 2024. The company has consistently maintained a strong performance in terms of generating returns on capital employed, with ratios fluctuating between 20% and 30% for the most part.
The relatively high and stable return on total capital indicates that Costco effectively utilizes both its debt and equity resources to generate profits. This metric reflects the company's efficiency in generating profits relative to the total capital invested in its operations. Overall, Costco's consistent performance in this aspect demonstrates its ability to create value for shareholders through effective capital allocation and operational management.
Peer comparison
Feb 18, 2024