Better Buy: Walmart vs. Costco
Inflation is tripping up even top companies that usually demonstrate growth and profitability, and the stock market looks like it's going to end 2022 on a down note. The S&P 500 is already off 17% this year although that's up from its 2022 lows. The S&P 500 has lost value in only 10 out of the last 50 years, so it's a fairly unusual event.
The S&P 500 is an index, and its performance reflects the average of the 500 stocks it tracks. Both Walmart (NYSE: WMT) and Costco Wholesale (NASDAQ: COST), which are S&P 500 components, are outperforming the overall average. Walmart stock is down less than 2% in 2022, and Costco is off by less than 10%. Which one of these is the better buy today? Two Motley Fool contributors frame the debate.
Jennifer Saibil (Costco): Costco has long been a recession-resistant stock. Its operating model, which involves an annual membership fee, allows it to charge rock-bottom prices that attract customers when they are pinching pennies. That's why Costco is still posting double-digit sales growth two years after the pandemic started, even through inflation, and even as similar retailers are slowing down.
Source Fool.com
