Costco Wholesale Corp (COST)vsThe Home Depot Inc (HD)
COST
Costco Wholesale Corp
$1,008.79
-0.32%
CONSUMER DEFENSIVE · Cap: $449.00B
HD
The Home Depot Inc
$317.45
-1.61%
CONSUMER CYCLICAL · Cap: $321.36B
Smart Verdict
WallStSmart Research — data-driven comparison
Costco Wholesale Corp generates 74% more annual revenue ($286.27B vs $164.68B). HD leads profitability with a 8.6% profit margin vs 3.0%. HD appears more attractively valued with a PEG of 2.88. COST earns a higher WallStSmart Score of 61/100 (C+).
COST
Buy61
out of 100
Grade: C+
HD
Hold50
out of 100
Grade: D+
Intrinsic Value Comparison
Multi-model valuation · Graham Formula
Margin of Safety
-89.1%
Fair Value
$535.26
Current Price
$1008.79
$473.53 premium
Margin of Safety
-32.6%
Fair Value
$243.24
Current Price
$317.45
$74.21 premium
Key Strengths & Concerns
Side-by-side fundamental analysis
Key Strengths
Mega-cap, among the largest globally
Safe zone — low bankruptcy risk
Every $100 of equity generates 30 in profit
Conservative balance sheet, low leverage
Revenue surging 21.5% year-over-year
Earnings expanding 45.5% YoY
Mega-cap, among the largest globally
Every $100 of equity generates 146 in profit
Safe zone — low bankruptcy risk
Generating 2.3B in free cash flow
Areas to Watch
3.0% margin — thin
Operating margin of 3.7%
Expensive relative to growth rate
Premium valuation, high expectations priced in
Weak financial health signals
Expensive relative to growth rate
Trading at 24.7x book value
Revenue declined 3.8%
Comparative Analysis Report
WallStSmart ResearchBull Case : COST
The strongest argument for COST centers on Market Cap, Altman Z-Score, Return on Equity. Revenue growth of 21.5% demonstrates continued momentum.
Bull Case : HD
The strongest argument for HD centers on Market Cap, Return on Equity, Altman Z-Score.
Bear Case : COST
The primary concerns for COST are Profit Margin, Operating Margin, PEG Ratio. A P/E of 52.6x leaves little room for execution misses. Thin 3.0% margins leave little buffer for downturns.
Bear Case : HD
The primary concerns for HD are Piotroski F-Score, PEG Ratio, Price/Book.
Key Dynamics to Monitor
COST profiles as a growth stock while HD is a value play — different risk/reward profiles.
HD carries more volatility with a beta of 1.00 — expect wider price swings.
COST is growing revenue faster at 21.5% — sustainability is the question.
HD generates stronger free cash flow (2.3B), providing more financial flexibility.
Bottom Line
COST scores higher overall (61/100 vs 50/100) and 21.5% revenue growth. Both earn "Buy" and "Hold" ratings respectively — the choice depends on your investment horizon and risk tolerance.
This analysis is generated from publicly available financial data. Not financial advice.
Costco Wholesale Corp
CONSUMER DEFENSIVE · DISCOUNT STORES · USA
Costco Wholesale Corporation (doing business as Costco Wholesale and also known simply as Costco) is an American multinational corporation which operates a chain of membership-only (needing a membership to shop there) big-box retail stores. As of 2020, Costco was the fifth largest retailer in the world, and the world's largest retailer of choice and prime beef, organic foods, rotisserie chicken, and wine as of 2016.
Visit Website →The Home Depot Inc
CONSUMER CYCLICAL · HOME IMPROVEMENT RETAIL · USA
The Home Depot, Inc., commonly known as Home Depot, is the largest home improvement retailer in the United States, supplying tools, construction products, and services. The company is headquartered in incorporated Cobb County, Georgia, with an Atlanta mailing address.
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