COSTNEUTRAL

COST FCF Yield Analysis

1.9%

Higher than 0% of CONSUMER DEFENSIVE sector peers

Updated 609h ago·SEC filings & market data

Key Takeaway

The FCF yield of 1.9% means the company generates $1.90 of free cash flow—cash left after operating expenses and capital spending—for every $100 of its market value.

Sector Performance

0th percentile

COST

1.9%

Sector Median

3.1%

Sector Avg

3.1%

Prior Period

1.8%(Jul 2026)

↑ Improving

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Deep Analysis

The FCF yield of 1.9% means the company generates $1.90 of free cash flow—cash left after operating expenses and capital spending—for every $100 of its market value.

That is low relative to its sector: the consumer defensive median FCF yield is 3.1%, and COST sits at the 0th percentile among peers, meaning it is the most expensive on this basis. The trend is limited: year-over-year change is N/A, but quarter-over-quarter the FCF yield rose 5.6%, with the two most recent values at 1.9% and 1.8%. The combination of a very low yield and a slight QoQ improvement suggests the stock offers little cash return cushion, but the recent uptick hints at modest strengthening. For an investor, the low yield points to elevated valuation risk relative to peers, while the recent positive move softens that concern. This mixed signal supports the overall NEUTRAL verdict: the weak level argues against buying, but the small improvement prevents a clear bearish stance.

Frequently Asked Questions

What does the FCF Yield tell investors about COST?

One of the purest measures of value. High FCF yield means the company generates a lot of cash relative to its price — favoured by value investors.

How is the FCF Yield calculated?

FCF Yield is calculated as: Free Cash Flow / Market Cap.

How does COST's FCF Yield compare to its sector?

COST's FCF Yield of 1.9% compares to a CONSUMER DEFENSIVE sector median of 3.1%, placing it in the 0th percentile.

Who are COST's closest peers by FCF Yield?

The closest CONSUMER DEFENSIVE peers by FCF Yield include: PG (4.4%).

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Learn More About FCF Yield

Understanding Free Cash Flow

Free cash flow is the lifeblood of any business. In this post, we explore why it matters more than net income for long-term investors.

Free Cash Flow Yield: Why It Matters More Than Earnings Per Share

EPS is accounting. FCF is reality. Here's how to calculate free cash flow yield, why Warren Buffett prioritizes it, and how to use it to spot genuinely profitable companies.

The Formula

Free Cash Flow / Market Cap

Why It Matters

One of the purest measures of value. High FCF yield means the company generates a lot of cash relative to its price — favoured by value investors.