GOBankingRates works with many financial advertisers to showcase their products and services to our audiences.
These brands compensate us to advertise their products in ads across our site.
This compensation may impact how and where products appear on this site.
Commitment to Our Readers
GOBankingRates' editorial team is committed to bringing you unbiased reviews and information.
you’re able to read more about oureditorial guidelinesand our products and servicesreview methodology.
Both companies strive to offeraffordable priceson a wide range of products.
Consumers arent the only ones who have benefited from Walmart and Costco.
These retail giants have made plenty of investors happy.
Both stocks have delivered positive returns over many years while offering dividends for patient investors.
While these stocks have delivered impressivelong-term returns, one of them is the clear winner.
Heres what you should know when comparing Walmart and Costco stock.
Walmart has been a haven duringinflation.
Shares only dropped by 2% in 2022 amid record inflation and regular interest rate hikes.
Walmart has gained some momentum with its e-commerce sales, and that has led to meaningful stock gains.
E-commerce sales increased by 16% year-over-year in the first quarter report for this year.
Its a sign that Walmart can compete with Amazon on the digital front.
The company has also benefited from an advertising segment that grew by 29% year-over-year.
However, advertising only represents a small portion of Walmarts revenue.
It can take several years before Walmart Connects ad growth translates into higher profit margins.
Thats more than double Walmarts return during the same stretch, and the pattern continues with a shorter lens.
The wholesaler has produced a 235% return for investors over the past five years.
However, the stock has only been up by 31% over the past year.
Thats still impressive, but its lower than Walmarts return during the same stretch.
Costco was less resilient during the high inflation and interest rate hikes that defined 2022.
Shares dropped by about 20% that year but rallied stronger than Walmart shares.
Costco has been opening more wholesale locations and expanding its international footprint.
E-commerce has been one ofCostcos strengthsin recent years.
The company posted 17.1% year-over-year e-commerce growth in the first 24 weeks of fiscal 2025.
Total revenue increased by 6.0% year-over-year.
Walmart vs. Costco: Which Stock Is the Better Buy?
Both retailers are in good positions to negotiate with suppliers to minimize tariff-related price hikes.
Their leverage is hard to match due to their sprawling physical footprints, customer bases, and credibility.
Although Costco has delivered higher long-term returns, Walmart looks like the better buy.
Walmart has a lower P/E ratio and a higher dividend yield.
Both stocks are competitive picks, but Walmart looks more attractive at current levels.
More From GOBankingRates
Share This Article:
