Which stock is a better buy right now, BJ’s (BJ) or Costco (COST)? In this video, I analyze both firms’ balance sheets, profitability, and growth. Using an intrinsic valuation model, I determine which stock is a better buy, BJ or COST.
0:00 – Introduction to BJ’s and Costco
2:04 – BJ vs. Costco Balance Sheet and DuPont Analysis
6:59 – BJ vs. Costco Valuation Multiples and Size
9:07 – Free Cash Flow to Equity Model
11:00 – BJ’s Intrinsic Value
13:41 – Costco Intrinsic Value
15:36 – Final thoughts
Liabilities-to-Assets Ratio = Total Liabilities / Total Assets
Current Ratio = Current Assets / Current Liabilities
Quick Ratio = (Current Assets – Inventory) / Current Liabilities
Interest Coverage Ratio = (Earnings before Interest and Taxes) / Income Tax Expense
Dividend Yield = Dividends Per Share / Stock Price
Payout Ratio = Dividends paid / Net Income
Modified Payout Ratio = (Dividends paid + Share buybacks) / Net Income
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***** Disclaimer *******
This content is for entertainment and education purposes only. Dr. Dan does not provide investment advice. The information in this video is being presented may not be suitable for all investors as it does not consider individual investor risk tolerance levels, investment goals, or financial circumstances. Past performance may not be a reliable indicator of future performance.
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