Core Insights - Costco and Walmart are the two largest retailers globally, with Walmart operating big box and grocery stores, while Costco focuses solely on club stores [1] - Both companies are currently considered expensive, with price-to-sales, price-to-earnings, and price-to-book ratios above their five-year averages and the market's average [1] Valuation and Investment Appeal - Value investors are likely to avoid both stocks due to their high valuation metrics, with Walmart's P/E ratio exceeding the market average [1] - Dividend investors may also be disinterested, as Walmart's dividend yield is 0.8% and Costco's is even lower at 0.5%, both below the S&P 500's yield of 1.1% [2] Growth Potential - Growth investors may find Costco more appealing due to its ongoing geographic expansion, despite Walmart's larger size [3] Company Performance Metrics - Costco's current price is $940.10, with a market cap of $417 billion, a gross margin of 12.88%, and a dividend yield of 0.68% [5] - Walmart's current price is $119.13, with a market cap of $950 billion, a gross margin of 23.90%, and a dividend yield of 0.79% [6][7] Business Model and Long-term Outlook - Costco's membership fees contribute significantly to its gross profits, allowing for lower product margins and higher member retention [5] - Walmart benefits from consumers trading down to its stores due to economic conditions, but this could change if the economy improves [7] - Both companies are well-managed, but their current valuations make them less attractive for many investors, with Costco's business model seen as better positioned for long-term success [8]