Costco

quote:

---

Had some cash sitting around and bought COSTCO last week

---

Damn, why didn’t I hear about this in the news?

Costco is an extremely well run, profitable company that is completely misunderstood by a lot of people. Majority of their profit if not all comes from membership fees. Merchandise and groceries are basically sold at cost to run the business, however they have very few loss leaders to get in the door. They also carry very few items in inventory at one time and turn it very quickly leading to very little waste. This makes them very efficient and shows why they can pay their employees so well and still compete on price.

They do not care about short term, and generally hire people who are life long employees into leadership positions. So the stock generally reflects this sort of slow moving ship .. or it should. The stock has a cult following primarily assuming that membership fees go up every 5 years. Which they have not done yet. However the stock by most measures is very expensive, but you almost always have to pay a premium to buy Costco stock relative to the market