This Costco-Like Retailer Trades at a Much Cheaper Valuation Than Costco. Is It a Buy?

BJ's Wholesale Club (NYSE: BJ) operates in the same membership-warehouse niche that has made Costco Wholesale (NASDAQ: COST) a market favorite. Yet, the two stocks command very different valuations today. The smaller chain, which is more well-known on the East Coast than elsewhere, trades at a much lower earnings multiple despite operating a similar value-based model built on membership fees and bulk goods.The valuation gap between BJ's and its larger and more fine-tuned peer is worth a closer look following the smaller membership-based warehouse retailer's recent quarterly update. BJ's delivered mid-single-digit revenue growth and another strong quarter for membership fees -- an important driver of recurring income for this type of retailer. At the same time, however, profit growth lagged as operating expenses climbed.For investors trying to decide whether BJ's offers a bargain alternative to Costco, here's a closer look at how it measures up.Continue readingWeiter zum vollständigen Artikel bei MotleyFool Weiter zum vollständigen Artikel bei MotleyFool