Head-To-Head Survey: Costco Wholesale (NASDAQ:COST) and Natural Grocers by Vitamin Cottage (NYSE:NGVC)

Natural Grocers by Vitamin Cottage (NYSE:NGVC) and Costco Wholesale (NASDAQ:COST) are both consumer staples companies, but which is the superior stock? We will compare the two companies based on the strength of their analyst recommendations, earnings, profitability, valuation, risk, institutional ownership and dividends.

Profitability

This table compares Natural Grocers by Vitamin Cottage and Costco Wholesale’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Natural Grocers by Vitamin Cottage	3.55%	21.11%	7.03%
Costco Wholesale	3.04%	27.60%	10.63%

Dividends

Natural Grocers by Vitamin Cottage pays an annual dividend of $0.60 per share and has a dividend yield of 2.0%. Costco Wholesale pays an annual dividend of $5.88 per share and has a dividend yield of 0.6%. Natural Grocers by Vitamin Cottage pays out 29.1% of its earnings in the form of a dividend. Costco Wholesale pays out 28.3% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Natural Grocers by Vitamin Cottage has raised its dividend for 1 consecutive years and Costco Wholesale has raised its dividend for 22 consecutive years.

Earnings and Valuation

This table compares Natural Grocers by Vitamin Cottage and Costco Wholesale”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Natural Grocers by Vitamin Cottage	$1.33 billion	0.52	$46.44 million	$2.06	14.44
Costco Wholesale	$303.15 billion	1.46	$9.23 billion	$20.76	47.97

Costco Wholesale has higher revenue and earnings than Natural Grocers by Vitamin Cottage. Natural Grocers by Vitamin Cottage is trading at a lower price-to-earnings ratio than Costco Wholesale, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

Natural Grocers by Vitamin Cottage has a beta of 1.27, meaning that its share price is 27% more volatile than the S&P 500. Comparatively, Costco Wholesale has a beta of 0.88, meaning that its share price is 12% less volatile than the S&P 500.

Analyst Ratings

This is a summary of current ratings and target prices for Natural Grocers by Vitamin Cottage and Costco Wholesale, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Natural Grocers by Vitamin Cottage	0	2	3	0	2.60
Costco Wholesale	1	8	25	0	2.71

Natural Grocers by Vitamin Cottage presently has a consensus price target of $43.00, indicating a potential upside of 44.54%. Costco Wholesale has a consensus price target of $1,086.19, indicating a potential upside of 9.08%. Given Natural Grocers by Vitamin Cottage’s higher probable upside, equities analysts clearly believe Natural Grocers by Vitamin Cottage is more favorable than Costco Wholesale.

Insider and Institutional Ownership

32.0% of Natural Grocers by Vitamin Cottage shares are held by institutional investors. Comparatively, 68.5% of Costco Wholesale shares are held by institutional investors. 58.3% of Natural Grocers by Vitamin Cottage shares are held by company insiders. Comparatively, 0.1% of Costco Wholesale shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Summary

Costco Wholesale beats Natural Grocers by Vitamin Cottage on 12 of the 17 factors compared between the two stocks.

About Natural Grocers by Vitamin Cottage

Natural Grocers by Vitamin Cottage, Inc., together with its subsidiaries, retails natural and organic groceries, and dietary supplements in the United States. The company’s stores offer natural and organic grocery products, such as organic produce; private label repackaged bulk products, including dried fruits, nuts, grains, granolas, teas, herbs, and spices, as well as peanut and almond butters; private label products comprising grocery staples, household products, bulk foods, and vitamins and dietary supplements, as well as organic eggs, organic flavored coffee, and organic mustard; dry, frozen, and canned groceries; meat and seafood products; dairy products, dairy substitutes, and eggs; prepared foods; bread and baked products; beverages; and beer, wine, and hard cider products. Its stores also provide name-brand supplements, as well as private label dietary supplements; body care products consisting of cosmetics, skin care, hair care, fragrance, and personal care products containing natural and organic ingredients; pet care and food products; books and handouts; household and general merchandise, including cleaning supplies, paper products, and dish and laundry soaps, as well as other common household products, such as diapers; and books and handouts. The company operates its retail stores under the Natural Grocers by Vitamin Cottage trademark, as well as Vitamin Cottage Natural Grocers and Health Hotline trademarks. The company also offers science-based nutrition education programs to help customers make informed health and nutrition choices. Natural Grocers by Vitamin Cottage, Inc. was founded in 1955 and is headquartered in Lakewood, Colorado.

About Costco Wholesale

Costco Wholesale Corporation, together with its subsidiaries, engages in the operation of membership warehouses in the United States, Puerto Rico, Canada, Mexico, Japan, the United Kingdom, Korea, Australia, Taiwan, China, Spain, France, Iceland, New Zealand, and Sweden. The company offers branded and private-label products in a range of merchandise categories. It offers merchandise, such as sundries, dry groceries, candies, coolers, freezers, deli, liquor, and tobacco; appliances, electronics, health and beauty aids, hardware, garden and patio products, sporting goods, tires, toys and seasonal products, office supplies, automotive care products, postages, tickets, apparel, small appliances, furniture, domestics, housewares, special order kiosks, and jewelry; and meat, produce, service deli, and bakery products. The company also operates gasoline, pharmacies, optical, food courts, hearing-aid centers, and tire installation centers; and offers business delivery, travel, grocery, and various other services online. It also operates e-commerce websites. The company was formerly known as Costco Companies, Inc. and changed its name to Costco Wholesale Corporation in August 1999. Costco Wholesale Corporation was founded in 1976 and is based in Issaquah, Washington.