Costco Wholesale Corp (COST)vsRio Tinto ADR (RIO)
COST
Costco Wholesale Corp
$974.86
+0.11%
CONSUMER DEFENSIVE · Cap: $432.25B
RIO
Rio Tinto ADR
$87.54
+0.89%
BASIC MATERIALS · Cap: $139.55B
Smart Verdict
WallStSmart Research — data-driven comparison
Costco Wholesale Corp generates 397% more annual revenue ($286.27B vs $57.64B). RIO leads profitability with a 17.3% profit margin vs 3.0%. COST appears more attractively valued with a PEG of 5.41. RIO earns a higher WallStSmart Score of 54/100 (C-).
COST
Buy53
out of 100
Grade: C-
RIO
Buy54
out of 100
Grade: C-
Intrinsic Value Comparison
Multi-model valuation · Graham Formula
Margin of Safety
-74.7%
Fair Value
$558.15
Current Price
$974.86
$416.71 premium
Margin of Safety
-136.9%
Fair Value
$41.41
Current Price
$87.54
$46.13 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
Generating 1.7B in free cash flow
Large-cap with strong market position
Attractively priced relative to earnings
Reasonable price relative to book value
Strong operational efficiency at 25.3%
Generating 2.5B in free cash flow
Areas to Watch
Trading at 13.5x book value
3.0% margin — thin
Operating margin of 3.7%
Expensive relative to growth rate
Expensive relative to growth rate
Earnings declined 5.6%
Comparative Analysis Report
WallStSmart ResearchBull Case : COST
The strongest argument for COST centers on Market Cap, Altman Z-Score, Return on Equity.
Bull Case : RIO
The strongest argument for RIO centers on Market Cap, P/E Ratio, Price/Book. Profitability is solid with margins at 17.3% and operating margin at 25.3%. Revenue growth of 14.6% demonstrates continued momentum.
Bear Case : COST
The primary concerns for COST are Price/Book, Profit Margin, Operating Margin. A P/E of 50.7x leaves little room for execution misses. Thin 3.0% margins leave little buffer for downturns.
Bear Case : RIO
The primary concerns for RIO are PEG Ratio, EPS Growth.
Key Dynamics to Monitor
COST profiles as a value stock while RIO is a mature play — different risk/reward profiles.
COST carries more volatility with a beta of 0.99 — expect wider price swings.
RIO is growing revenue faster at 14.6% — sustainability is the question.
RIO generates stronger free cash flow (2.5B), providing more financial flexibility.
Bottom Line
RIO scores higher overall (54/100 vs 53/100), backed by strong 17.3% margins and 14.6% revenue growth. 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 →Rio Tinto ADR
BASIC MATERIALS · OTHER INDUSTRIAL METALS & MINING · USA
Rio Tinto Group is dedicated to the exploration, extraction and processing of mineral resources worldwide. The company is headquartered in London, the United Kingdom.
Compare with Other DISCOUNT STORES Stocks
Want to dig deeper into these stocks?