Costco

Navigate firm data through the following pages:

Analyst Listing       Primary Input Data
Derived Input Data       Valuation Model Outcomes

Analyst Listing

The following analysts provide coverage for the subject firm as of May 2016:

Broker Analyst Analyst Email
Stephens Inc Ben Wyatt ben.wyatt@stephens.com
Susquehanna Financial Group Biju Perincheril biju.perincheril@sig.com
Johnson Rice & Company Charles Meade cmeade@jrco.com
Cowen & Company Charles Robertson charles.robertson@cowen.com
Piper Jaffray David Kistler david.w.kistler@simmonspjc.com
Wells Fargo Securities David Tameron david.tameron@wellsfargo.com
GMP Securities Derrick Whitfield dwhitfield@gmpsecurities.com
Credit Suisse Edward Westlake edward.westlake@credit-suisse.com
IBERIA Capital Partners Eric Fox eric.fox@iberiabank.com
Evercore ISI Greg Melich greg.melich@evercoreisi.com
Alembic Global Advisors James Sullivan james.sullivan@alembicglobal.com
KLR Group John Gerdes jjg@klrgroup.com
Jefferies Jonathan D. Wolff jwolff@jefferies.com
Telsey Advisory Group Joseph Feldman jfeldman@telseygroup.com
Raymond James Kevin Smith kevin.smith@raymondjames.com
Nomura Research Lloyd Byrne lloyd.byrne@nomura.com
Seaport Global Securities Michael Kelly mkelly@seaportglobal.com
Mitsubishi UFJ Securities (USA) Michael McAllister mmcallister@us.sc.mufg.jp
Wolfe Research Paul Sankey psankey@wolferesearch.com
Scotia Howard Weil Peter Kissel peter.kissel@scotiabank.com
BMO Capital Markets Phillip Jungwirth phillip.jungwirth@bmo.com
Capital One Securities Phillips Johnston phillips.johnston@capitalone.com
Deutsche Bank Research Ryan Todd ryan.todd@db.com
RBC Capital Markets Scott Hanold scott.hanold@rbccm.com
Evercore ISI Stephen Richardson stephen.richardson@evercoreisi.com
Guggenheim Securities Subash Chandra subash.chandra@guggenheimpartners.com
Wunderlich Securities Vedran Vuk vedranvuk@wundernet.com
Roth Capital Partners Chris Lewis clewis@roth.com
The Benchmark Company, LLC Jan Wald jwald@benchmarkcompany.com
Canaccord Genuity Jason Mills jmills@canaccordgenuity.com
Brean Capital, LLC Jason Wittes jwittes@breancapital.com
Barrington Research Michael Petusky mpetusky@brai.com
Stifel Nicolaus Rick Wise wiser@stifel.com

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Primary Input Data

 

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Derived Input Data

Derived Input

Label

2015  Value

2016  Value

Equational Form
Net Operating Profit Less Adjusted Taxes NOPLAT   2,356   2,438 NOPLAT\, =\, EBIT\, x\, (1 \,-\, Avg \,\,Tax\,\, Rate\,\, on\,\, EBIT)
Free Cash Flow FCF  1,375  2,610 FCF\,=NOPLAT\,+\,Non-Cash\,Expenses-\Delta NWC\,-\,NCS
Tax Shield TS  41  44 TS\,=\,Interest\,\,Paid\,\,x\,\, Avg \,\,Tax\,\,Rate\,\, on\,\, Pre-Tax\,\, Income
Invested Capital IC  17,890  17,170 IC\,=\,Fixed\,\,Operating\,\,Assets\,\,+\,\,Net\,\, Working\,\, Capital
Return on Invested Capital ROIC 13.17% 14.20% ROIC\,=\,\frac { NOPLAT }{ IC }
Net Investment NetInv  1,504  570 NetInv\,=\,{ {IC}_{1}}-{{IC}_{0}}+Depreciation
Investment Rate IR 63.85% 23.40% IR\,=\,\frac {NetInv}{NOPLAT}
Weighted Average Cost of Capital WACCMarket 7.43% 8.80% WACC\,=\,\frac { E }{ V } { R }_{ E }\,+\,\frac { P }{ V } { R }_{ P }\,+\,\frac { D }{ V } { R }_{ D }\left( 1- Avg\,\, Tax\,\,Rate\,\,on\,\,Pre-Tax\,\,Income \right)
 WACCBook  7.39% 8.07%
Enterprise value EVMarket  71,499  70,876  EV\,=\,Market\,\,Cap\,\,Equity\,+\,\,Long\,\,Term\,\,Debt\,-\,Cash
 EVBook  70,459  70,749
EV/EBIT Multiple \frac{EV_{Market}}{EBIT}  19.73  18.90 EV/EBIT\,=\,\frac { EV}{ EBIT}
Long-Run Growth g = IR x ROIC
   8.41%   3.32% Long-run growth rates of the income variable  are used in the Continuing Value portion of the valuation models.
 g = % \Delta GDP    2.50%   2.50%

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Valuation Model Outcomes

The outcomes presented in this study are the result of original input data, derived data, and synthesized inputs and, depending on the equational form of any particular valuation model, may result in irrelevant or implausible results.  For example, in the event WACC < g, the value of this term, often found in the denominator of an equation’s continuation value term, will be expressly negative and may result in a negative overall valuation for the firm.  In the event of a WACC < g relation, the model form as applied to the subject firm offers an irrelevant outcome.

Valuation Model Type

Label

Equational form
Key Value Driver (NOPLAT) KVD (NOPLAT) { Value }_{ DCF/KVD }=\sum { \frac { NOPLAT_{ t } }{ { \left( 1+WACC \right) }^{ t } } +\frac { \frac { { NOPLAT }_{ 1 }\left( 1-\frac { g }{ ROIC } \right) }{ WACC-g } }{ { \left( 1+WACC \right) }^{ t } } }
 
Key Value Driver (FCF) KVD (FCF)
{ Value }_{ DCF/KVD }=\sum { \frac { FCF_{ t } }{ { \left( 1+WACC \right) }^{ t } } +\frac { \frac { { NOPLAT }_{ 1 }\left( 1-\frac { g }{ ROIC } \right) }{ WACC-g } }{ { \left( 1+WACC \right) }^{ t } } }
 
Free Cash Flow FCF { Value }_{ DCF/FCF }=\sum { \frac { FCF_{ t } }{ { \left( 1+WACC \right) }^{ t } } +\frac { \frac { { FCF }_{ 1 }}{ WACC-g } }{ { \left( 1+WACC \right) }^{ t } } }
 
Economic Profit ECON π { Value }_{ { ECON\pi } }= I{ C }_{ 0 }+\sum { \frac { { IC }_{ t-1 }(ROI{ C }_{t}-WAC{C}_{t}) }{ { \left( 1+WACC \right) }^{ t } }+ \frac {\frac { I{C}_{0}\ x\ (ROI{C}_{1}\ -\ WAC{C}_{1}) }{ WACC-g } }{ { \left( 1+WACC \right) }^{ t } } }
 
Adjusted Present Value APV { Value }_{ APV }=\sum { \frac { FCF_{ t } }{ { \left( 1+{ k }_{ u } \right) }^{ t } } +\frac { \frac { { FCF }_{ 1 }}{ { k }_{ u }-g } }{ { \left( 1+{ k }_{ u } \right) }^{ t } } } +\sum { \frac { { TS }_{ t } }{ { \left( 1+{ k }_{ tax } \right) }^{ t } } +\frac { \frac { { TS }_{ 1 }}{ { k }_{ tax }-g } }{ { \left( 1+{ k }_{ tax } \right) }^{ t } } }
 
Forward Market Multiple FMM { Value }_{ DCF/FMM}=\sum { \frac { FCF_{ t } }{ { \left( 1+WACC \right) }^{ t } } +\frac { { EBIT }_{ 1 }\,{x}\,{FMM}}{ { \left( 1+WACC \right) }^{ t } } }{\,\,\,; \,\,FMM\,=\,\frac{{EV}_{t=0}}{{EBIT}_{t=0}}}
 

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