Financial Research Report: CostCo
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This assignment is an analysis of a U.S. publicly-traded company, with either a subsidiary or division operating outside of North America and its common stock as a prospective investment. Format and actions to complete:
Company Overview. Conduct research and describe the company, its operations, locations, markets, and lines of business. Collect financial statements for the past 3 years, fiscal or calendar.
Ratio Analysis. Perform trend and ratio analysis on current and fixed assets, current and long term liabilities, owner's equity, sales revenues, EBIT, net income, and earnings per share. Project these trends 3 years in the future.
Stock Price Analysis. Research the company's common stock price for the past 5 years. Research the Standard & Poor's Stock Market Index (S&P 500) for the past 5 years. Chart the price movement in the company's common stock against the S&P price movement. State and support your opinion on the company's common stock as an investment today.
Foreign Operations. Select a company subsidiary or division operating outside of North America and describe the subsidiary's or division's operation, location, market(s), and line(s) of business, and how they relate to the parent company's operations. Compare the financial growth of its overseas operations for the past 3 years.
Global Analysis. Decide whether, in the event of an economic slowdown in the U.S., the company's overseas revenue generation might serve to shelter the parent from slow or negative growth in the U.S. market. Explain and support your opinion.
References. Use at least 5 references
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Solution Summary
The solution examines Financial Research Report for CostCo.
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Company Analysis
Costco Wholesale Corporation
Table of Contents
Company Overview 2
Ratio Analysis: 4
Liquidity Ratio: 5
Asset management Ratio: 5
Debt Management Ratio: 6
Profitability Ratio: 6
Market Value: 6
Stock Price analysis: 6
Foreign Operation: 7
Global analysis: 9
Works Cited 10
Company Overview
Costco Wholesale Corporation along with its subsidiaries started its operations in the year 1983 in Seattle, Washington of United States. The company merged with The Price Company in October 1993 to form Price/Costco, Inc., a Delaware corporation, merging with the Price Company pioneered the membership warehouse concept to the Costco Wholesale Corporation. The company spins off most of its non warehouse assets to the Price Enterprises, Inc in January 1997. On August 30, 1999, the company reincorporated from Delaware to Washington and changed its name to Costco Wholesale Corporation (SEC Filing (10K), 2008).
The company Costco Wholesale Corporation operates an international chain of membership warehouses. The company is mainly operates under the name of "Costco Wholesale". The company has quality, brand name and competitive pricing in its membership houses as compared to other wholesale and retail sources. The company has designed the the warehouses in a manner to help small-to-medium-sized businesses reduce there costs in purchasing the products for resale and for everyday of there business use. In the Costco Wholesale Corporation individual customers may also purchase for their personal needs by becoming the member of the company warehouse (Costco Wholesale Corporation, Website).
The company presents one of the largest and most exclusive product category selections in its warehouses that can be found under a single roof. These product categories include candy, groceries, television and media, appliances, automotive supplies, tires, tobacco, toys, hardware, sporting goods, jewelry, office supplies, office equipment, cameras, books, house wares, apparel, health and beauty aids, furniture, and watches. The biggest strength of the company is its top quality national and regional brands that provide customers a high level of satisfaction and guaranteed at very reasonable prices (Costco Wholesale Corporation, Website).
One of the company division, Costco Wholesale Industries, operates manufacturing businesses. Its manufacturing business includes special food packaging, jewelry distribution, optical laboratories, and meat processing (Costco Wholesale Corporation, Website).
The company Costco is open only to its members. It offers three types of membership: Business membership, Gold Star (individual) membership and the Executive membership. The business members of the company qualify for business membership by owning or operating a business. The business members pay an annual fee ($50 in the U.S.) to shop for personal use, resale, and business. The fee charged by the business member also includes the spouse card for the business member. The business members of the company may purchase up to six additional membership cards ($40 each) for its partners or ...
Education
- MBA, Indian Institute of Finance
- Bsc, Madras University
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