Costco Wholesale Corp (COST)vsHormel Foods Corporation (HRL)
COST
Costco Wholesale Corp
$1,011.70
+0.11%
CONSUMER DEFENSIVE · Cap: $450.10B
HRL
Hormel Foods Corporation
$21.33
-0.65%
CONSUMER DEFENSIVE · Cap: $11.74B
Smart Verdict
WallStSmart Research — data-driven comparison
Costco Wholesale Corp generates 2257% more annual revenue ($286.27B vs $12.14B). HRL leads profitability with a 4.0% profit margin vs 3.0%. HRL appears more attractively valued with a PEG of 1.44. COST earns a higher WallStSmart Score of 61/100 (C+).
COST
Buy61
out of 100
Grade: C+
HRL
Buy54
out of 100
Grade: C-
Intrinsic Value Comparison
Multi-model valuation · Graham Formula
Margin of Safety
-89.9%
Fair Value
$532.85
Current Price
$1011.70
$478.85 premium
Margin of Safety
+53.6%
Fair Value
$51.61
Current Price
$21.33
$30.28 discount
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
Reasonable price relative to book value
Areas to Watch
3.0% margin — thin
Operating margin of 3.7%
Expensive relative to growth rate
Premium valuation, high expectations priced in
ROE of 6.1% — below average capital efficiency
4.0% margin — thin
Revenue declined 2.9%
Earnings declined 5.1%
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 : HRL
The strongest argument for HRL centers on Price/Book. PEG of 1.44 suggests the stock is reasonably priced for its growth.
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 : HRL
The primary concerns for HRL are Return on Equity, Profit Margin, Revenue Growth. Thin 4.0% margins leave little buffer for downturns.
Key Dynamics to Monitor
COST profiles as a growth stock while HRL is a value play — different risk/reward profiles.
COST carries more volatility with a beta of 0.98 — expect wider price swings.
COST is growing revenue faster at 21.5% — sustainability is the question.
COST generates stronger free cash flow (1.7B), providing more financial flexibility.
Bottom Line
COST scores higher overall (61/100 vs 54/100) and 21.5% revenue growth. HRL offers better value entry with a 53.6% margin of safety. Both earn "Buy" and "Buy" 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 →Hormel Foods Corporation
CONSUMER DEFENSIVE · PACKAGED FOODS · USA
Hormel Foods Corporation is an American company founded in 1891 in Austin, Minnesota, by George A. Hormel as George A. Hormel & Company. Originally focusing on the packaging and selling of ham, Spam, sausage and other pork, chicken, beef and lamb products to consumers; by the 1980s, Hormel began offering a wider range of packaged and refrigerated foods.
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