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Walmart Financial Analysis And Stock Prices Valuation: Is Walmart a Good Choice?

Updated on February 19, 2014

An investment of $100 made in 1971 in Walmart stock can now be equivalent to $315,000! This is one of the dreams most investors would like to realize. However, the exponential growth of Walmart stock price is now over and this type of scenario may be too rare to accomplish. With all these being said, can Walmart still be a good place to invest hard-earned money? Or is it just benefiting its long time investors?

One of the most recent developments in Wall Street is that Nomura Securities gave Walmart stock price a buy-rating. This has been a great improvement for Wal-mart Stores’ performance since its decline during the last year. The confidence of most investors has been assuaged as Warren Buffett still holds on to his long-time invested stock, Wal-mart Stores. While it is true that Warren Buffett has been a long-time investor of Wal-Mart, fresh investors can still expect to get more returns from its investment.

The full name of Walmart is Wal-Mart Stores, Inc. It is a public retail store that is part of the S&P 500 component, making Walmart stock price as one of the best investment options. In the New York Stock Exchange, it is registered as WMT. The company was founded by Sam Walton in Rogers, Arkansas, 1962. As of now, Wal-Mart Stores, Inc is headquartered in Bentonville, Arkansas with 11,137 locations around the world. There are different products that Walmart sells. These include footwear specialty, apparel, cash & carry, warehouse club, hypermarket, supermarket, superstore, supercenter, and discount store – all contributing Walmart stock price.

As of 2013, the total revenue of Walmart is $469.162 billion and its operating income is $27.801 billion, thereby improving Walmart stock price. The company’s net income is $16.999 billion; total assets of $203.105 billion; and total equity of $76.343 billion. It is currently owned by Walton family and has over 2.2 million employees, making Walmart as the largest employers in the world. Moreover, it is considered as part of the Top 50 list of World’s Most Valuable Companies.

Walmart is a multinational company, which means it is operating both in the local and global market. There are forecasts and analysis that would attest to the continued growth of Walmart stock price in 2014. Throughout the history of Walmart, it has tremendously increased in size to almost 1 billion square feet globally. In 2012, it has announced that it will stop or slow down its expansion in the US to focus more in the international market to further improve Walmart stock price.

While it is true that Walmart stock price has underperformed the S&P 500 Index from 2009 during the global financial crisis, it is now making an impressive comeback in 2013 and 2014. Though Walmart has underperformed in the last few years, it never stopped to make sure that its stock holders will not be affected by the recession. As a matter of fact, Walmart has its share holders in the forefront of its agenda. This is evident as one looks at the earnings per share rate of the company. The EPS grew up to 59% and its free cash flow increased by 123%. When it comes to dividends, the company has paid its shareholders a whopping $60 billion. As a matter of fact, in the midst of the economic difficulties, Walmart still managed to increase its annual dividend every single year and sustain the growth of its Walmart stock price.

In conclusion, Walmart’s significant commitment in handling its shareholders’ interests is something that every investor would surely appreciate. While it is true that the best time you should have invested in Walmart stock price was 40 years ago, it is not too late to make an investment today and enjoy annual growth of your stock value.


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