Retailing Industry Investment Analysis Based on Indicators: Evidence from Costco, Walmart and Target

Abstract

With the development of big data, internet of things artificial intelligent and other high-tech, the retail industry has witnessed the upgrading of industrial structure. Updating our methods to manifest and predict the performances of retail companies is becoming an urge. This research focuses on using indicators to analyze retailing industry, and exemplifying the method with the examples of Costco, Walmart and Target. The data includes return on equity, asset beta, equity beta, WACC, liquidity ratio, profitability ratio and solvency ratio. By analyzing the data, this study conducts further reason analysis to find out the inherent reasons why these companies display the specific data. Some differences of the three enterprises are found from the ratio perspectives and reveals the intrinsic differences of their management and sales model and policies. We also provide an investment guideline of the three companies based on our analysis and comparison of the three companies. These results may shed a new light on the analysis of the retail industry, and the analyzing process may be extended to other investment field.