Costo as you know is a giant Wholesaler that manages many warehouses and sells all tutor products at great prices (in my opinion) but most of their revenue and especially their cash flow comes from their memberships being about 40% of free cash flow. This gives Costco many of advantages. Giving it a unique moat. Its Kirkland brand also gives Costco a huge boost and leverage in prices with manufacturers and suppliers. Which in turn gives them the best prices. Also people should but might not think about much is that Costco owns 923 locations giving it a bunch of real estate kinda similar to McDonald but it’s a wholesaler that sells all types of products.
But I feel that most people know this which is why investors give it such a premium valuation.
So what’s your thoughts do you feel there overvalued even if they seem to be growing at amazing rates?
Or is this just the valuation Costco should be trading at?