If You'd Invested $5,000 in Costco's IPO, This Is How Much Money You'd Have Now
All there is to investing is picking good stocks at good times and staying with them as long as they remain good companies.
-- Warren Buffett
Costco Wholesale (NASDAQ: COST) is one of the "good" companies. Co-founded by James Sinegal with one warehouse store in Seattle in 1976, Costco has grown mightily over the years based on a simple set of tenets: Sell quality merchandise at low prices, invest generously in your employees, and treat people (including suppliers) with fairness, dignity, and respect.
Of course, selling at low prices is an understatement for Costco. The company operates on razor-thin margins. Last year, it earned $3.13 billion on $138 billion in sales. That's a profit margin of 2.3%, a major improvement from where it was 10 years ago. And keep in mind that virtually all of Costco's profit is derived from membership fees, which means it's selling everything at just enough of a gross profit to cover operating expenses.
Source Fool.com
