Costco(COST) The Motley Fool·2025-04-26 13:10Company Overview - Costco has generated a total return of 22,000% over the past 40 years, translating a 2.2 billion today, with an annualized gain of 14.4% [1] - The company operates 897 locations globally, with a focus on providing quality merchandise at affordable prices [3] Growth and Expansion - Costco's store count has grown from 221 in 1994, with plans for nearly half of new store openings to occur outside the U.S. [4] - Same-store sales increased by 6.8% in Q2, marking at least 13 consecutive years of growth in this key metric [5] - Diluted earnings per share have grown at a compound annual rate of 11.6% over the past 20 years, with expectations of 11.1% growth from fiscal 2024 to fiscal 2027 [6] Competitive Position - Costco is the third-largest retailer globally, generating $62.5 billion in net sales during the 12-week period ending Feb. 16 [8] - The company benefits from significant buying leverage due to its scale and a limited number of stock-keeping units, which allows for cost savings passed on to consumers [9] - Membership households increased by 6.8% in the latest fiscal quarter, with a high renewal rate of 90.5% [9] Investment Considerations - Current share prices are down 9% from their February peak, but the price-to-earnings ratio stands at 57, which is near its highest level ever [10] - The high valuation may hinder potential returns, suggesting that investors should be cautious about purchasing the stock at this time [11]