Costco Wholesale Corp. (NASDAQ:COST)

The financial indicators reveal several notable trends over the analyzed periods. Total asset turnover, both reported and adjusted, demonstrates a generally increasing trajectory, indicating improved efficiency in utilizing assets to generate revenues. After a decline in 2020, the ratios recovered and surpassed initial levels by 2024, suggesting enhanced operational performance.

Current ratio figures show relative stability with minor fluctuations. The reported and adjusted ratios peaked in 2020 and 2023, reflecting a slight improvement in short-term liquidity during those years. However, the latest period in 2024 shows a slight decrease below 1, which may warrant monitoring to ensure adequate liquidity.

Leverage metrics highlight a consistent reduction in reported debt to equity and debt to capital ratios over time, implying a strengthening equity base or reduced reliance on debt financing. Adjusted leverage ratios follow a similar downward trend but remain higher than reported values, indicating possible adjustments for off-balance sheet items or other considerations. Financial leverage decreases notably from 2019 to 2023, followed by a modest rise in 2024, suggesting a cautious approach to leveraging assets.

Profitability indicators show positive momentum. The reported net profit margin steadily rises throughout the years, culminating near 3% in 2024. Adjusted margins fluctuate somewhat but maintain an upward trend overall. Return on equity exhibits variability with peaks in 2021 and a strong increase in 2024, reflecting improved profitability relative to shareholders' equity. Adjusted ROE trends mirror this pattern, albeit with slightly lower values in some periods.

Return on assets values indicate consistent growth, signaling enhanced efficiency in asset usage to generate profits. Both reported and adjusted ROA increase over the timeframe, with a slight dip in 2023 adjusted ROA but recovery in 2024 to the highest observed levels. This upward trend in ROA aligns with improvements in asset turnover and net profit margin, reinforcing the overall positive financial performance.

Total Asset Turnover

Improved post-2020 with increasing capacity to generate sales from assets.

Current Ratio

Generally stable with a recent slight decrease below 1, prompting attention to liquidity levels.

Debt to Equity and Debt to Capital

Downward trend indicates reduced leverage and stronger equity financing.

Financial Leverage

Declining over the years, suggesting prudent asset financing, with a slight recent uptick.

Net Profit Margin

Consistent improvement reflecting better profitability control.

Return on Equity

Variable but overall increasing, highlighting enhanced return on shareholder investments.

Return on Assets

Steady increase indicates rising efficiency in asset utilization for profit generation.

Net Sales

Net sales exhibited a consistent upward trajectory over the examined periods, increasing from 149,351 million USD in 2019 to 249,625 million USD in 2024. This represents a substantial growth in revenue, indicating effective market penetration and demand expansion.

Total Assets

Total assets grew steadily from 45,400 million USD in 2019 to 69,831 million USD in 2024. This gradual expansion reflects ongoing investments in assets, possibly in support of the company's sales growth and operational capacity enhancement.

Reported Total Asset Turnover

The reported total asset turnover ratio showed some variation but overall improvement. It started at 3.29 in 2019, dipped to 2.94 in 2020, likely influenced by external factors during that year, and then increased consistently to 3.57 by 2024. This trend indicates improving efficiency in using assets to generate sales.

Adjusted Total Assets

Adjusted total assets followed a trajectory similar to total assets, rising from 46,884 million USD in 2019 to 69,283 million USD in 2024. The adjustment accounts for asset valuation or accounting recalibrations but preserves the overall growth pattern.

Adjusted Total Asset Turnover

Adjusted total asset turnover mirrored the pattern of the reported asset turnover ratio. Starting at 3.19 in 2019, dipping slightly to 2.96 in 2020, and thereafter experiencing consistent growth to reach 3.60 in 2024. This confirms enhanced asset utilization after adjusting for asset value considerations.

The analysis of the annual financial data reveals several key trends and shifts in the liquidity position and short-term financial health over the six-year period.

Current Assets

Current assets show a consistent upward trend from 2019 through 2023, increasing from approximately 23.5 billion USD to nearly 35.9 billion USD. However, in 2024, there is a slight decline to about 34.2 billion USD, indicating a moderate reduction after several years of growth.

Current Liabilities

Current liabilities also increase steadily over the same period, rising from approximately 23.2 billion USD in 2019 to approximately 35.5 billion USD in 2024. The growth in liabilities outpaces that of current assets in the last year, as evidenced by the continued increase in liabilities despite the decrease in assets.

Reported Current Ratio

The reported current ratio fluctuates around the 1.0 benchmark during the entire period. It starts slightly above 1.0 in 2019, peaks at 1.13 in 2020, and then returns to near 1.0 in subsequent years. The ratio dips below 1.0 in 2024, reaching 0.97, which suggests that current liabilities have surpassed current assets, potentially indicating a slight weakening in short-term liquidity.

Adjusted Current Assets and Adjusted Current Ratio

Adjusted current assets mirror the trend seen with reported current assets but incorporate a small adjustment starting in 2022. This adjustment slightly increases the asset base that year, reflected in a minor improvement in the adjusted current ratio to 1.04 in 2022 compared to the reported 1.02. Nonetheless, the adjusted current ratio follows the same general pattern as the reported figure and also falls below 1.0 in 2024.

In summary, the data indicates consistent growth in both current assets and liabilities over the initial years, with assets generally maintaining an edge over liabilities. However, by 2024, liabilities exceed assets slightly, leading to current ratios below 1.0, signaling a potential concern in short-term financial stability. The adjusted figures confirm this trend, providing a consistent view of tightening liquidity at the end of the period under review.

Total Debt

The total debt exhibited an overall decline from 2019 to 2024, decreasing from $7,244 million in 2019 to $7,395 million in 2024, with a peak observed in 2021 at $8,543 million. After 2021, the debt consistently decreased each year, indicating a trend towards debt reduction in the most recent periods.

Total Costco Stockholders’ Equity

Stockholders’ equity showed a general upward trend between 2019 and 2024. Starting at $15,243 million in 2019, equity rose steadily to a high of $25,058 million in 2023 before slightly declining to $23,622 million in 2024. This trend indicates a strengthening equity base over the period, despite the slight dip in the last year.

Reported Debt to Equity Ratio

The reported debt to equity ratio declined consistently from 0.48 in 2019 to 0.31 in both 2023 and 2024. This decline reflects an improving balance sheet with reduced reliance on debt relative to equity, particularly pronounced after 2021.

Adjusted Total Debt

Adjusted total debt followed a similar pattern to total debt but at higher absolute values. It increased from $9,126 million in 2019 to a peak of $11,407 million in 2021. Subsequently, it decreased each year, ending at $9,949 million in 2024. This indicates that while adjusted debt levels peaked around 2021, there has been a movement towards deleveraging in later years.

Adjusted Total Equity

The adjusted total equity increased steadily from $15,729 million in 2019 to a peak of $25,362 million in 2023, followed by a slight decrease to $23,843 million in 2024. This upward trend suggests overall equity growth consistent with reported figures, reinforcing the strengthening financial position of the company.

Adjusted Debt to Equity Ratio

The adjusted debt to equity ratio remained stable at 0.58 from 2019 to 2020, then increased slightly to 0.62 in 2021, reflecting the peak in adjusted debt. After 2021, the ratio declined significantly to 0.42 in 2023 and remained stable in 2024. This pattern aligns with the reduction in adjusted debt and an increase in equity, indicating improved leverage management.

The analysis of the provided financial data reveals several key trends in the company's debt and capital structure over the period from 2019 to 2024.

Total Debt

The total debt showed a general increase from 2019 through 2021, rising from $7,244 million to $8,543 million. However, from 2022 onwards, total debt began to decline steadily, reaching $7,395 million by 2024. This suggests a reduction in the company’s leverage in the most recent years.

Total Capital

Total capital exhibited a consistent upward trend from 2019 to 2023, increasing from $22,487 million to $32,948 million, indicating growth in the company’s overall funding base, potentially through retained earnings or equity issuance. In 2024, total capital slightly decreased to $31,017 million, suggesting a minor contraction or reallocation of resources.

Reported Debt to Capital Ratio

This ratio decreased from 0.32 in 2019 to 0.24 in 2023 and remained flat at 0.24 in 2024. The decline reflects an improving balance sheet with relatively less reliance on debt financing over time, reinforcing the trend of decreasing leverage observed in total debt figures.

Adjusted Total Debt

Adjusted debt, which may account for additional liabilities or off-balance-sheet financing, rose from $9,126 million in 2019 to a peak of $11,407 million in 2021. Following this peak, it declined annually to $9,949 million in 2024, paralleling the trend seen with reported total debt but at higher absolute levels.

Adjusted Total Capital

Adjusted total capital increased steadily from $24,855 million in 2019 to $35,898 million in 2023, before a moderate decrease to $33,792 million in 2024. This aligns closely with the movements in reported total capital and may reflect similar underlying capital management practices.

Adjusted Debt to Capital Ratio

The adjusted debt to capital ratio remained relatively stable at around 0.37 to 0.38 from 2019 to 2021, suggesting consistent leverage levels during these years when considering adjusted figures. It then declined to 0.29 by 2023 and remained steady in 2024, indicating a reduction in adjusted leverage, consistent with observed trends in both debt and capital.

Overall, the data indicates a period of increasing leverage up to 2021, followed by a strategy oriented toward debt reduction and capital growth through 2023, with slight decreases in capital in 2024. This shift suggests a focus on strengthening the balance sheet and potentially improving financial flexibility.

The data reveals an overall upward trend in the total assets across the six-year period, with values increasing from 45,400 million US dollars in 2019 to 69,831 million US dollars in 2024. This consistent growth suggests an expansion in the company's asset base. Adjusted total assets follow a similar trajectory, reinforcing this observation.

Total stockholders' equity shows a general increase as well, rising from 15,243 million US dollars in 2019 to a peak of 25,058 million in 2023 before contracting slightly to 23,622 million in 2024. A comparable pattern is observed in adjusted total equity, which also climbs steadily through 2023 and dips marginally in 2024. This indicates strengthening equity positions over time with a minor setback in the latest year.

The reported financial leverage ratio exhibits some fluctuation over the period. It begins near 2.98 in 2019, rises to a peak of 3.37 in 2021, then declines to 2.75 in 2023 before rising again to 2.96 in 2024. This pattern indicates variations in the relative proportions of debt to equity, initially increasing leverage before a reduction and slight subsequent increase.

Adjusted financial leverage demonstrates a slightly different trend, starting at 2.98 in 2019, dipping to 2.91 in 2020, then rising to 3.2 in 2021, followed by a decrease to 2.7 in 2023 and a rise to 2.91 in 2024. The variations suggest some volatility but overall a tendency to remain around the 2.7 to 3.2 range, signifying a relatively stable capital structure when adjustments are considered.

Overall, the company has expanded its asset base and increased stockholders’ equity over the period analyzed, with some variability in financial leverage ratios, indicating evolving leverage strategies over time. The slight declines in equity and increases in leverage in the most recent year may warrant attention to sustainability and risk management considerations going forward.

Total Assets

Steady increase from 45,400 million to 69,831 million over six years, reflecting growth in asset base.

Total Stockholders’ Equity

Growth from 15,243 million to peak of 25,058 million, followed by a small decline to 23,622 million, indicating strengthening equity with a minor recent decrease.

Reported Financial Leverage

Fluctuations between 2.75 and 3.37, with an initial increase, subsequent reduction, and slight rise again, reflecting changing debt-to-equity proportions.

Adjusted Total Assets and Equity

Similar upward trends as unadjusted figures, confirming overall growth in asset and equity levels.

Adjusted Financial Leverage

Ranges between 2.7 and 3.2, showing relative stability with some volatility, suggesting consistent leverage levels after adjustment.

Net Income Attributable to Costco

The net income exhibited a consistent upward trend over the analyzed period. Starting at 3,659 million US dollars in the fiscal year ending September 2019, it increased steadily year over year, reaching 7,367 million US dollars by the fiscal year ending September 2024. This represents more than a doubling of net income across the six-year span.

Net Sales

Net sales also demonstrated continuous growth during the period. Beginning at 149,351 million US dollars in 2019, net sales rose each year to reach 249,625 million US dollars in 2024. This reflects a total increase of approximately 67%. The growth rate was particularly notable between 2020 and 2022, suggesting expanded revenue-generating activities during this interval.

Reported Net Profit Margin

The reported net profit margin remained relatively stable, fluctuating slightly but generally trending upward. It held steady at 2.45% in 2019 and 2020, then showed marginal increases in subsequent years, reaching 2.95% in 2024. This indicates a modest improvement in profitability relative to sales over time.

Adjusted Net Income Including Noncontrolling Interests

This measure closely parallels the trend observed in net income, increasing from 3,601 million US dollars in 2019 to 7,243 million US dollars in 2024. The adjusted net income reflects similar growth dynamics, confirming robust underlying earnings performance when excluding certain accounting impacts.

Adjusted Net Profit Margin

The adjusted net profit margin showed some variability, initially increasing from 2.41% in 2019 to 2.78% in 2021, before declining to 2.49% in 2022 and 2023. However, it rebounded to 2.90% in 2024. This pattern suggests some fluctuation in profitability efficiency, possibly due to changing cost structures or external factors impacting margins in the middle years, followed by a recovery.

The financial data reveals several key trends in the company's profitability and equity management over the six-year period ending in 2024.

Net Income Attributable

There is a consistent and marked increase in net income attributable, rising from 3,659 million USD in 2019 to 7,367 million USD in 2024. This represents more than a doubling over the timeframe, indicating strong profitability growth.

Total Stockholders' Equity

Stockholders' equity grew steadily from 15,243 million USD in 2019 to a peak of 25,058 million USD in 2023, followed by a slight decline to 23,622 million USD in 2024. This overall upward trend signals accumulation of retained earnings and possibly additional capital contributions, though the dip in 2024 suggests some capital return or revaluation.

Reported Return on Equity (ROE)

The reported ROE fluctuated within a mid to high 20% range, starting at 24% in 2019, dipping slightly in 2020 to approximately 21.9%, then rising to 28.5% in 2021. After a minor decrease in 2022 and 2023, ROE peaked at 31.2% in 2024, demonstrating effective use of equity to generate profits, particularly in the most recent year.

Adjusted Net Income Including Noncontrolling Interests

This measure follows a similar upward trend to net income attributable, increasing from 3,601 million USD in 2019 to 7,243 million USD in 2024. The consistency between adjusted and reported net income suggests limited impact from noncontrolling interests or one-time items on overall profitability.

Adjusted Total Equity

Adjusted equity mirrors the pattern seen in total equity, increasing from 15,729 million USD in 2019 to 25,362 million USD in 2023, then declining slightly to 23,843 million USD in 2024. This adjusted figure likely accounts for additional considerations such as goodwill or other adjustments, yet the trend remains similar, reflecting strengthening capital base over time.

Adjusted Return on Equity (Adjusted ROE)

The adjusted ROE shows variability over the years, starting at 22.9% in 2019, maintaining a similar level in 2020, then peaking at 29.1% in 2021. This is followed by a decline to 23.3% in 2023 before rebounding strongly to 30.4% in 2024. These movements indicate varying effectiveness in utilizing adjusted equity to generate income, with a particularly strong performance in 2024.

Overall, the data indicates solid profit growth with increasing returns on equity, both reported and adjusted, peaking in the latest year. The equity base has expanded substantially over the period, supporting this profitability, though the slight equity contraction in the final year may warrant further investigation. The alignment between adjusted and reported figures suggests stable financial reporting and limited distortions from extraordinary items or noncontrolling interests.

Net Income Attributable to Costco

The net income shows a consistent upward trend over the six-year period. Starting at $3,659 million in 2019, it increased steadily each year to reach $7,367 million by 2024. This indicates strong profitability growth and improved earnings performance.

Total Assets

Total assets increased from $45,400 million in 2019 to $69,831 million in 2024. The growth in assets has been steady, reflecting ongoing investment and expansion in the company’s asset base. However, the rate of increase appears to slow slightly in the last year compared to earlier periods.

Reported Return on Assets (ROA)

Reported ROA fluctuated mildly but generally improved from 8.06% in 2019 to 10.55% in 2024. The ROA dipped to 7.2% in 2020 but then recovered and increased gradually each year afterward, demonstrating enhanced efficiency in utilizing assets to generate net income.

Adjusted Net Income Including Noncontrolling Interests

Adjusted net income increased from $3,601 million in 2019 to $7,243 million in 2024, mirroring the trend seen in reported net income. This measure also shows consistent growth, suggesting sustained profitability even after accounting for noncontrolling interests.

Adjusted Total Assets

Adjusted total assets rose from $46,884 million in 2019 to $69,283 million in 2024. The increase is in line with the trend in reported total assets, indicating that the adjustments do not substantially alter the underlying asset growth pattern.

Adjusted Return on Assets (ROA)

Adjusted ROA demonstrated an overall upward trend with some variability. Starting at 7.68% in 2019, it increased to 9.08% in 2021, then slightly declined to 8.63% in 2022 and 2023 before rising sharply to 10.45% in 2024. This pattern suggests periods of fluctuating operational efficiency, followed by a significant improvement in the most recent year.

Overall Insights

The financial data reflects a company with strong and rising profitability, evident through increasing net income figures and improving returns on assets. The growth in asset base supports expansion activities but has been managed efficiently enough to enhance asset profitability over time. The adjustments for noncontrolling interests and other factors do not materially change the observed trends, reinforcing the robustness of these performance metrics. Notably, the improved ROA in the latest period points to enhanced operational effectiveness and asset utilization.