COST vs WMT: Costco vs Walmart — Which Retail Giant Wins?: AI Score, Valuation, Performance and Upside
Costco is priced as a compounding membership machine with minimal earnings volatility, while Walmart is a diversified retail and emerging advertising platform at a more moderate valuation. COST commands a premium for its model quality; WMT offers more growth levers through advertising and e-commerce at a lower starting multiple.
Use this COST vs WMT comparison to weigh model quality against valuation. Costco's membership economics and loyalty are exceptional but come at a steep price. Walmart's diversification into advertising and digital commerce may offer more upside from current levels for valuation-sensitive investors.
WMT holds the edge across 4 of 5 key metrics in this comparison. WMT leads on both 1-year return (+11.90%) and forward P/E quality (31.99x vs 41.72x for COST), a relatively favorable combination of momentum and valuation. On fundamentals, COST is growing revenue faster (21.50%), while WMT maintains the higher operating margin (4.99%) — a classic growth-versus-profitability split. Analyst consensus implies meaningfully more upside for WMT (+23.90%) than for COST (+13.94%).
Human Wall Street analysts' price targets, typically implying a ~12-month view — a separate signal from this site's own AI Prediction Signal further down the page, which is a 5-/30-day machine-learning forecast based on price history alone.
- Want a high-quality compounder with predictable membership-driven earnings
- Value near-100% gross margin on membership fees as a durable profit floor
- Are comfortable paying a premium multiple for a best-in-class retail model
- Prefer a retailer with minimal business model disruption risk
- Want exposure to the world's largest retailer with a growing advertising business
- Prefer a more moderate valuation with multiple long-term growth levers
- Believe Walmart+ and Walmart Connect can meaningfully close the gap with Amazon
- Value grocery and essential goods resilience across economic cycles
| Metric | COST | WMT |
|---|---|---|
| AI scorei | 63.7 | 54.9 |
| AI ranki | #93 | #270 |
| Latest closei | $1,003.32 | $119.89 |
| 1M returni | +10.90% | +8.47% |
| 3M returni | +7.30% | +9.52% |
| 6M returni | -0.77% | -7.72% |
| 1Y returni | +6.21% | +11.90% |
How much would $10,000 be worth today if invested at the start of each period, with all dividends reinvested?
| Period | COST | WMT |
|---|---|---|
| 1Y ago | $10.65K (+6.5%) started 2025-10-23 | $11.22K (+12.2%) started 2025-10-23 |
| 5Y ago | $22.48K (+124.8%) started 2021-10-25 | $26.62K (+166.2%) started 2021-10-25 |
| 10Y ago | $92.12K (+821.2%) started 2016-10-24 | $71.94K (+619.4%) started 2016-10-24 |
Hypothetical — past performance does not guarantee future results.
| Metric | COST | WMT |
|---|---|---|
| Market capi | $419.3B | $820.4B |
| Trailing P/Ei | 47.63 | 37.35 |
| Forward P/Ei | 41.72 | 31.99 |
| Price/Salesi | 1.67 | 1.14 |
| EV/Revenuei | 1.42 | 1.21 |
| Analyst targeti | $1,077.31 | $127.73 |
| Target upsidei | +13.94% | +23.90% |
| Metric | COST | WMT |
|---|---|---|
| Revenue growthi | 21.50% | 5.90% |
| Earnings growthi | 45.50% | -9.10% |
| EPS growthi | +45.50% | -9.10% |
| FCF margini | +2.37% | +1.22% |
| Operating margini | 3.67% | 4.99% |
| Profit margini | 3.01% | 3.00% |
| ROIC proxyi | 29.15% | 22.31% |
| Return on equityi | 29.15% | 22.31% |
| Dividend yieldi | 0.62% | 0.96% |
| Payout ratioi | 26.69% | 34.96% |
| Dividend growth streaki | No increase yet | No increase yet |
| Betai | 0.86 | 0.60 |
| Debt/equityi | 60.26 | 70.38 |
| Current ratioi | 1.07 | 0.77 |
| Quick ratioi | 0.56 | 0.20 |
Over the past year, COST and WMT have moved moderately in the same direction (correlation of 0.62), based on daily returns.
Lower drawdown and smaller single-period drops generally indicate a smoother ride, though they do not guarantee lower future risk.
| Period | Metric | COST | WMT |
|---|---|---|---|
| 1Y | Growthi | +6.50% | +12.19% |
| CAGRi | +6.51% | +12.21% | |
| Volatilityi | 19.77% | 26.26% | |
| Sharpe ratioi | 0.19 | 0.40 | |
| Sortino ratioi | 0.27 | 0.55 | |
| Max drawdowni | 18.33% | 23.52% | |
| Current drawdowni | 8.32% | 10.66% | |
| Avg drawdowni | 7.42% | 9.01% | |
| Ulcer Indexi | 9.39% | 11.43% | |
| Max daily dropi | 4.21% | 9.15% | |
| Max wkly dropi | 8.96% | 11.67% | |
| 5Y | Growthi | +114.47% | +152.43% |
| CAGRi | +16.50% | +20.37% | |
| Volatilityi | 22.94% | 22.61% | |
| Sharpe ratioi | 0.59 | 0.74 | |
| Sortino ratioi | 0.82 | 1.03 | |
| Max drawdowni | 31.40% | 25.74% | |
| Current drawdowni | 8.32% | 10.66% | |
| Avg drawdowni | 9.63% | 6.69% | |
| Ulcer Indexi | 11.77% | 9.23% | |
| Max daily dropi | 12.45% | 11.38% | |
| Max wkly dropi | 16.26% | 19.49% | |
| 10Y | Growthi | +675.15% | +507.77% |
| CAGRi | +22.73% | +19.78% | |
| Volatilityi | 22.06% | 22.18% | |
| Sharpe ratioi | 0.84 | 0.72 | |
| Sortino ratioi | 1.20 | 1.06 | |
| Max drawdowni | 31.40% | 25.74% | |
| Current drawdowni | 8.32% | 10.66% | |
| Avg drawdowni | 6.97% | 6.39% | |
| Ulcer Indexi | 9.44% | 8.87% | |
| Max daily dropi | 12.45% | 11.38% | |
| Max wkly dropi | 16.26% | 19.49% |
| Category | COST | WMT |
|---|---|---|
| Company | Costco Wholesale Corporation | Walmart Inc. |
| Sector | Consumer Defensive | Consumer Defensive |
| Industry | Discount Stores | Discount Stores |
| Core business | Membership-based warehouse retailer selling bulk merchandise at low markup. Revenue durability comes from membership fees, which carry near-100% gross margins and extremely high renewal rates. | World's largest retailer by revenue with stores, Sam's Club membership warehouses, Walmart+, and a fast-growing advertising and marketplace business (Walmart Connect). |
| Investor focus | Membership fee growth and renewal rates, same-store sales momentum, international expansion, and whether the premium valuation is justified by the compounding membership model. | U.S. comp store sales, Walmart+ subscriber growth, advertising revenue scaling, grocery share gains vs Amazon, and international unit performance (especially Flipkart). |
- Membership fee stream acts as a nearly pure-profit recurring revenue layer
- Extremely high membership renewal rates (~93%) indicate deep customer loyalty
- Limited SKU model keeps costs low and inventory turns high
- Grocery dominance provides traffic and resilience in any economic environment
- Walmart Connect advertising business growing rapidly from a high-margin base
- Walmart+ and fulfillment services increasingly position WMT as an ecosystem play
- Premium valuation — COST consistently trades at a significant P/E premium to peers
- Execution risk in international expansion and new warehouse ramp
- Consumer spending sensitivity in a discretionary slowdown
- Margin pressure from supply chain costs, shrink, and mix shift to lower-margin grocery
- Walmart+ subscriber growth vs Amazon Prime scale advantages
- International complexity (Flipkart valuation, China JV) adds earnings uncertainty
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