WMT Investment Analysis Report & Stock Research, Wal-Mart Stores, Inc.

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WMT Stock Report

2-Year Price History

Recent Price
(6/26 4:02PM) -1.1%
$48.63
52-Week Price
$46.25 - $63.85
Market Capitalization
$189.5 Billion
Dividend Yield
2.20%
Most Recent Dividend
$0.95

Ockham's Rating

At Ockham Research, we believe that there is extremely useful information to be gleaned from historical evidence. When a stock is out of line with historical norms it could definitely be a signal that it is overvalued or undervalued. But as proponents of the Efficient Market Hypothesis will tell you, the market is never wrong about stock prices because everything that can be known about a stock has already been priced in. However, in extreme cases, such as the Tech bubble in the early 2000’s or more recently the credit crisis demonstrates there are certainly times where historical evidence can be misleading. Episodes such as this do prove that times of great market correction either positive or negative can be driven by factors outside of fundamentals.

Ockham Research is reaffirming our rating on WMT this week although we believe that this stock has become more intriguing based on the underlying fundamentals at this price level. Overall, the NYSE has been relatively stable over the last few months, or at least, the performance of the market has not crossed a major volatility standard deviation over the last six months. For a detailed analysis of this stock please read the following report.

First, WMT increased in price by 0.95% since 06/20/2009 and this does not greatly impact our outlook.

Second, since our last report, there have been no significant adjustments in earnings expectations or guidance.

WMT Stock Evaluation

Looking at WMT since last week, there has been little movement in price on a percentage basis. Additionally, there haven't been significant revisions to earnings estimates for WMT. Given this, we are maintaining our Undervalued rating. While there may not have been any meaningful changes in either price or earnings outlook, we still want to analyze where WMT is in relationship to its historical fundamentals. Looking at the ratios and multiples described below and throughout this report is the best way to evaluate the strength of WMT's current Undervalued rating.

WMT Revenue

As we have often noted, in our valuation methodology, "Cash is King." Well, it goes without saying that if a company cannot produce sales then there is no ability to generate cash flow. By that logic we look very closely at revenue numbers as our second most important factor in valuing a company's stock. We have established reasonable Price to Sales per share ranges based on historical data of the last 10 years. For, WMT the high and low end of the Price to Sales per share ratios are 0.77x and 0.59x respectively.

Notice that WMT's current Price to Sales per share ratio is 0.44x, which is quite a bit below what we consider a normal Price to Sales ratio for this stock. Given normal conditions and a price of $48.63, WMT is 36% below where we would expect to see it. This will beneficially factor into our final analysis of WMT as it is not often that this stock sinks to these levels.

WMT Cash Earnings

Looking at WMT specifically in their Cash Earnings capabilities, Ockham views WMT as significantly below their historical average multiples of Cash Earnings, as calculated by our proprietary analysis. It is incredibly important to understand that for WMT, the current level of Cash Earnings compared to its historical levels helps identify where WMT is in relation to what the investing community was willing to pay for this level of Cash Earnings in the past. With a historical high Cash Earnings per share ratio of 15.55 and a historical low Cash Earnings per share ratio of 11.81, an investor can relate where value becomes optimal.

So what does "significantly below" mean when we talk about Price to Cash Earnings numbers for WMT? From the Ockham perspective, we are looking specifically at WMT to see if the market is recognizing the huge disparity between WMT's past stock price to Cash Earnings ratio to today's levels. At a difference of 32% below the average historical Price to Cash Earnings ratio, our view would be quite positive at this point. However, as with all metrics, we need to also take other factors into account when looking at WMT. While we view better Cash Earnings metrics as very important, if the market is slow to identify this value, or if Cash Earnings were to fall from these levels, we would become more neutral in our stance.

WMT Dividends

When determining a company's future prospects for success, Ockham Research sees analysis of dividend payments as a key additional factor. Even though it isn't imperative for WMT to shell out a dividend in order to receive a positive rating, it can be helpful to further our analysis.

The estimated annual dividend for WMT is $1.09 producing a current dividend yield of 2.24%. Much like our evaluation of Sales and Cash Earnings per share, we review dividend yields from WMT against the historic high and low levels over all available dividend history. Because dividends are a decision made exclusively by management, we view a healthy and rising dividend as a sign of confidence and strength. The highest dividend yield from WMT over previous years was 2.36% while the lowest dividend yield was 0.37%. If you are looking for some “bang for your buck” then a dividend yield of 64.10% above the historical median should be enticing. WMT receives a positive boost in our view because as you know, equity at its core is simply a claim on future dividends.

Peer Comparison

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Wal-Mart Stores, Inc. Industry Grouping

(6/26/2009)
Company Ticker Market Cap (Ml) Latest
Price
Price/Cash Earnings Price/Sales 5-Yr. Rev.
Growth Rate
5-Yr.
Avg. ROE.
Current 10-Yr. Range* Current 10-Yr. Range*
Peer Company Averages (not incuding WMT) 23.12 8.18 » 76.97 1.27 0.42 » 4.35 14.32% 24.28%
*10 year range does not include current year values
Wal-Mart Stores, Inc. WMT $189.5 Billion $48.63 9.32 8.76 » 31.69 0.44 0.44 » 1.52 9.38% 20.08%
Publix Super Markets, Inc. PUSH $83.3 Billion $105.00 54.40 6.49 » 64.44 3.46 0.40 » 4.15 7.14% 21.76%
CVS Caremark Corp. CVS $45.7 Billion $31.36 10.12 7.33 » 34.67 0.48 0.32 » 1.18 26.89% 12.12%
Home Depot, Inc. HD $40.2 Billion $23.61 9.37 6.35 » 51.07 0.54 0.40 » 3.55 1.92% 20.58%
Amazon.Com, Inc. AMZN $36.0 Billion $83.88 34.24 15.93 » 218.40 1.44 0.66 » 11.84 29.49% 48.16%
Target Corp. TGT $29.8 Billion $39.57 7.45 4.79 » 16.28 0.44 0.30 » 1.02 6.16% 18.80%
Current
Rating on:
WMT
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The latest TV Media Discussion

2:05:16 PM WMT $48.52 Wal-Mart Stores, Inc.
1 days ago (06/26)
“…Since june 15 of all of those trading days, only two have been to on the plus side. It shows the pressure on the market. Laggard on the dow jones/industrials average are american express and microsoft, WAL-MART, boeing. The names we've been watching. Boeing in particular losing more orders now. We have been hearing the dreamliner delays and it's putting pressure on the dow …” …more details…
12:02:16 PM WMT $48.55 Wal-Mart Stores, Inc.
1 days ago (06/26)
“…Time he wills the big drags of the market. Continue to see refiners get a whack, names like testero, eli lilly having a struggle in the and WALMART also down sharply today, 1.2%. On the leaderboard, we see strength in technology, and we'll talk more about that at the nasdaq. …” …more details…
5:15:31 PM WMT $49.15 Wal-Mart Stores, Inc.
Fast Money
2 days ago (06/25)
“…>> no, I think the -- the specialty retail space, I actually thing it's really expensive here. I think it's pricing in a very dramatic recovery that I am skeptical on. A WALMART is not pricing that in. I get much more comfortable with a WALMART here. A trade like that does not work on a day like today. I'm thinking a little further out than thursday. >> longer term. >> best buy pointing out that the sale of smart phones has …” …more details…
4:35:46 PM WMT $49.15 Wal-Mart Stores, Inc.
2 days ago (06/25)
“…Today, asked him about his business and the new competition best buy faces from online retailers after the collapse of circuit city. >> both WALMART and amazon in the online space are great at what they do. And i'll tell you how we position best buy. We position best buy by having our pricing being right there sticker to sticker with WALMART, and we do what we've always done, we use our people as the differentiation. If you take the pricing being at par and you take the differentiative experience our people provide, I like how that …” …more details…
4:11:57 PM WMT $49.15 Wal-Mart Stores, Inc.
2 days ago (06/25)
“…Reform committee weighs in on truth on the bank of america the new ceo of best buy. Hear his strategy for taking on the competition from WALMART to online retailers and what the bankruptcy of circuit city has meant for him. 45 and older...Just don't feel like they used to. Are you one of them? Remember when you had for 18 holes …” …more details…
5:17:52 PM WMT $48.51 Wal-Mart Stores, Inc.
Fast Money
3 days ago (06/24)
“…Been the best on the down side. I do think that that consumer isn't going to be back upstream or upscale any time soon. Those hiring from consumers are going to start to buy more things at WALMART from the discretionary side with higher >> patty, great to have you with us. Patty edwards from seattle. That was the word on the street. Coming up next, the transplant pioneer who happens to be john's …” …more details…
5:17:25 PM WMT $48.51 Wal-Mart Stores, Inc.
Fast Money
3 days ago (06/24)
“…People are going for fashion without having to pay up for it. They're also one of the few retailers that's still growing, and you need to respect that. They really have a model that's working where no one else does. With kohl's, WALMART. We've talked about that a lot. I really think that the consumer is going to continue to be we saw that at the grocery store today too. >> it's karen. I like WALMART, and I think it's been a great story. Where do you see it -- how do you look at valuation? What is your price target for >> I think that WALMART can hit we're sitting at 48 and change. It really has the more steady eddie quality to it. Once we start to see the market move up, it will go. …” …more details…
5:16:38 PM WMT $48.51 Wal-Mart Stores, Inc.
Fast Money
3 days ago (06/24)
“…Putting our feet down into the muck in the bottom of the lake. There's not a smooth push-off >> patty, you think things are you must be building a list what do you like and to what level do you like them? I know that WALMART is unwith of the things you like. >> WALMART is one of my names. I also like kohl's, and you could start nibbling and take it on the way down. Kohl's has got an amazing amount of fresh new merchandise that no one else has got. …” …more details…
11:47:26 AM WMT $48.77 Wal-Mart Stores, Inc.
4 days ago (06/23)
“…World out of its recession, and the reason is their strength in the last decade has been from exports to us and others, and we go into WAL-MART and buy the stuff, turn it upside down, says made in china. Until our demand strengthens, china won't strengthen. They can do some with their stimulus package, but they can't …” …more details…
7:17:55 AM WMT $48.50 Wal-Mart Stores, Inc.
5 days ago (06/23)
“…Is an outstanding agenda in theory but you have to ask fasces ceo of america what does your company salle and we sell everything we sell WAL-MART, guantanamo bay, energy, health care, immigration reform, auto and banking regulation is extraordinarily ambitious and extraordinarily expensive and …” …more details…
5:41:09 PM WMT $48.55 Wal-Mart Stores, Inc.
Fast Money
5 days ago (06/22)
“…>> walgreen? >> this stock goes from 21 to 32 in about 1 1/2 months. You think it's time to buy, no. >> one pop and you'll see a WALMART was up 1%. >> I love WALMART. It's not the most exciting, but it is a good place to hide in this market. They are delivering what the customer needs. I'll take that measly 1%. …” …more details…
3:59:10 PM WMT $48.63 Wal-Mart Stores, Inc.
5 days ago (06/22)
“…I had nothing in the green when I checked sector by sector. A couple of defensive plays like WAL-MART and verizon. A 262 point for the dow last week. We tacked on 60 points. The pressure was on. Oil fell. …” …more details…
3:33:15 PM WMT $48.76 Wal-Mart Stores, Inc.
5 days ago (06/22)
“…Look also at the names that we continue to watch here. The volume is approaching 900 million shares at 3:30. We have seen pressure, a couple of names in the green were verizon, WAL-MART. Across the board, down most we had nearly majority, more than 85% of the s&p 500 names have been to the down side. This is as the s&p 500 …” …more details…
3:03:16 PM WMT $48.66 Wal-Mart Stores, Inc.
5 days ago (06/22)
“…Look at retailers, too. Walgreens are a name that traders noted to me. When I walked in here, notice that the walgreens profits missed estimates taking down many of the names within the retailers. WAL-MART is doing well. Trying to hold on that. Is one name we've been watching in particular. Oil dropped to 67.06. …” …more details…
3:01:24 PM WMT $48.64 Wal-Mart Stores, Inc.
5 days ago (06/22)
“…Shrink by some 2.9% in '09. That is worse than the 1.7% initial estimate. That's really set the tone for the market today. We have some pockets of for example, WALMART is trading but that's not doing anything for the dow industrials. Here's where we stand. Dow jones industrials with a decline of 160, nearly 2% lower. Banks leading the charge there on the down side. …” …more details…
2:37:47 PM WMT $48.47 Wal-Mart Stores, Inc.
5 days ago (06/22)
“…But some of the services of what the banks do still need to be you don't have the companies providing them. Goldman sachs can charge a lot more money than they did a year ago. WALMART and cosco, all right? They have thin margins to get as many people in there. Big price wrecker. A horrible umbrella. Goldman never liked to repeat on price. >> they had to. …” …more details…
1:44:02 PM WMT $48.38 Wal-Mart Stores, Inc.
5 days ago (06/22)
“…You rotate back to consumer people said you could get back to discretionaries. >> oil is coming off a little maybe the consumer can afford a little bit more at WALMART. >> the automobile thing has been overblown. >> the $70, $75. A symbol of what's been happening that people pile on. …” …more details…
1:43:33 PM WMT $48.38 Wal-Mart Stores, Inc.
5 days ago (06/22)
“…>>> best members of the dow. Verizon verizon, p&g and WALMART. Is verizon a consumer staple. Is cell phone usage modified. >> the tv part of it. >> vios. >> internet. >> WALMART you could put in that category as well. Normally the retailer. >> but they sell food, gasoline, all of the things they didn't used to do. …” …more details…
12:58:50 PM WMT $48.39 Wal-Mart Stores, Inc.
5 days ago (06/22)
“…>>> welcome back to the "fast money halftime report." you're looking at a retailer which is trading up today. >> it might be time to get back in the start of 2008. Take a look at WALMART. Want to play defensive? Looks good. >> don't you think it's ahead? >> no, we don't operate that >> oh, you don't operate -- be an optimist. >> how about something like a no. >> like WALMART. Love the hypermarket model. Target is good, prefer WALMART. >> joe hart is WALMART. Call the close. Buy or sell going to 4:00 p.M. Eastern time? Dr. Jay, what are you doing? >> one retailer, coach, outperforming here today. But I don't like the broad market. …” …more details…
10:46:46 AM WMT $48.40 Wal-Mart Stores, Inc.
5 days ago (06/22)
“…There's concern about the health of the global economy, saying that overall it may fall more and expected and remainder of 2009. There are two stocks in the dow jones industrial average higher WAL-MART, maybe not a big surprise there, and verizon. The other 28 are down. Welsh the war funding bill that passed in congress includes nearly 5 billion for the imf. …” …more details…
10:43:46 AM WMT $48.40 Wal-Mart Stores, Inc.
5 days ago (06/22)
“…I'm just curious as to your view. We have eric shiro dmmpb is going for expansion in some of the hardest-hit areas of california economy. WALMART is still expanding this year, maybe not as much as last year, but they're hiring. Would you buy those names, still? >> well, i'll tell you this, we …” …more details…
9:51:10 AM WMT $48.27 Wal-Mart Stores, Inc.
5 days ago (06/22)
“…Shot of lower manhattan. Ominous-looking market on a if you look at the dow, only three or four stocks managing to go higher. Hewlett-packard on the cusp, but we're seeing strength in intel, travelers and WALMART. Hewlett-packard being riten up, one of three or four stocks in say that might be considering selling online software. It's tempting because it's …” …more details…
8:29:46 AM WMT $48.04 Wal-Mart Stores, Inc.
5 days ago (06/22)
“…Competition to us because of those almostelements -- those alexis: you are experiencing some stiff competition from the likes of WAL-MART how do you make sure you differentiate yourself when they offer probably the best value propositions in the country? >> you go back to the point of differentiation. We have passion at our core and conversations are so important between our associates and our …” …more details…
7:34:32 AM WMT $48.21 Wal-Mart Stores, Inc.
6 days ago (06/22)
“…People in sort of this downturn economy used cars are easier to get. I think people like carmax's no haggle policy. And, you know, there's stores it's sort of like WAL-MART almost. This sort of big box phenomena. Alexis: mary beth, what specifically is different about autonation from carmax? >> well, certainly it offers …” …more details…
5:12:06 PM WMT $48.12 Wal-Mart Stores, Inc.
Fast Money
8 days ago (06/19)
“…Strategists, folks. >>> I got a bada-bing here, the indexers will chase it because there is now the silver medalist in the index derby, sandwiched between exxon and WALMART. If you take a look at the month-to-date performance, microsoft number one on the nasdaq 100, but the market cap north of $50 billion. …” …more details…
1:47:45 PM WMT $48.23 Wal-Mart Stores, Inc.
8 days ago (06/19)
“…>> that's why we are highlighting the survival of the thriftiest and not saying back getting the consumer from WAL-MART out of the bunker and moving her to target, we don't think given all the things is not out of reach. >> at what point does oil become a factor here that truly …” …more details…
1:46:08 PM WMT $48.22 Wal-Mart Stores, Inc.
8 days ago (06/19)
“…Less defensive retailers like target, macy's and tj max are starting to outperform. That major shift in psychology and spending is bad for WAL-MART. The downgrade moved the market on monday. The high end is still getting the consumer shifting away from affluent shopping and luxury …” …more details…
8:32:26 AM WMT $48.89 Wal-Mart Stores, Inc.
8 days ago (06/19)
“…The iphone and selling it through the retail outlets. Shares moving higher also available at best buy and WAL-MART but it is hard to tell whether the deal is good or not but we will find out. Jenna: now going to the courts the madoff trading unit could …” …more details…
4:41:54 PM WMT $48.68 Wal-Mart Stores, Inc.
9 days ago (06/18)
“…Skimpy wardrobe, for more conservative clothing. >> what is this world coming to? >> three week in dubai? >> do you think she got that at WAL-MART? >> that is going to be the shortest television show in the history of t.V. >> there is also, so you think you want to be a japanese game show contestant. …” …more details…
2:21:06 PM WMT $48.74 Wal-Mart Stores, Inc.
9 days ago (06/18)
“…Paper products company. They private company for WAL-MART. >> and don't forget iron man. >> you spoke with the >> we spoke with marvel. >> marvel is all about stanley …” …more details…
1:43:12 PM WMT $48.83 Wal-Mart Stores, Inc.
9 days ago (06/18)
“…It was unique, clw, the stock symbol, this company spun off and it not only makes its own paper products but it brands WAL-MART-branded products for so you look and this is obviously a very smart investment pick for a lot of people that did buy into it out there because what happened during the recession. WAL-MART just saw record sales. You know, the revenues were soaring and this company makes, you know, paper products branded >> stuart: that is fascinating. Because one would expect a big …” …more details…
6:07:04 PM WMT $48.59 Wal-Mart Stores, Inc.
Mad Money
10 days ago (06/17)
“…Money, another whole group of gunslingers says the economies are going to revert to a people stop going to stores, they stop going out, stop spending. Well, they can go to WALMART. They eat at mcdonald's. Hey, how did those stocks do and they buy general mills. How did that stock do today? How about pepsi, another one of …” …more details…
3:59:56 PM WMT $48.53 Wal-Mart Stores, Inc.
10 days ago (06/17)
“…Dipped a little bit lower. Down six points at 8500. Volume better than we had been WAL-MART for sale. $1.1 billion changing hands. Drug stocks did well, retailors. Best buy took down the whole …” …more details…
2:38:07 PM WMT $48.70 Wal-Mart Stores, Inc.
10 days ago (06/17)
“…Way they've been doing their that's worked better than our attenuated stimulus plan but I think the second half will have good stimulus. >> this is an interesting point. Jim mentioned WALMART as a speculated name to list there. But it does play into your low >> when I see tjx, there's a lot of undercurrents right now. I call this the battle for the soul of the market. …” …more details…
2:36:55 PM WMT $48.69 Wal-Mart Stores, Inc.
10 days ago (06/17)
“…That said there was a run up. People got very excited and thought that was a good play. And we have good companies I like coca-cola very much. I have been recommending it on my show. WALMART is one that last night I talked about. If you think the economy is slowing, I wanted to mention some other retailers. So i'm not going to fight it. I'm just going to remind people that it didn't work the last …” …more details…
12:20:23 PM WMT $48.70 Wal-Mart Stores, Inc.
10 days ago (06/17)
“…Both of those mean you have to focus in, if you're going to play in retail, which is a dicey thing right now, on somebody who is selling food, because people still have to eat, and who has the best system. Once again, it comes down to WALMART for me. >> I think patty is spot on. We talked about this and said the retail trade, it was an easy money trade in retail a month or so ago, and now said it's hard a lot of people are saying great things, but it's already baked …” …more details…
9:11:04 AM WMT $48.33 Wal-Mart Stores, Inc.
10 days ago (06/17)
“…Are absolutely mind boggling. It is raising $700 million in order to better compete with WALMART's and t texaco. It's raising money and that's dragging the stock down as well nearly 6%. Mark and erin, back over to you. >> thank you, guy. >>> up next, e-trade shares …” …more details…
6:39:29 PM WMT $48.30 Wal-Mart Stores, Inc.
Mad Money
11 days ago (06/16)
“…I think kohl's is okay here, but i'm not crazy about retail. The only one I put into with my charitable trust is home depot, because I think housing's turning and I like the yield. The battle between the retailers, WALMART versus the winner? Gasoline goes below $3, stays goes above $3, WALMART. >>> next, try to keep up with cramer as he takes your calls rapid fire in an all new "lightning round." …” …more details…
6:36:25 PM WMT $48.30 Wal-Mart Stores, Inc.
Mad Money
11 days ago (06/16)
“…Better camp. Maybe the macroeconomic lesson we learn from this tale of two retailers is simply that we should own neither one. Here's the bottom line -- cramerican translation -- WALMART's dead money, but I don't think target can hit the target price without a decline in gasoline. Still, if you find yourself bypassing WALMART to hit a target, she could be dead right on the trade. But if my biggest swing factor, gasoline, spikes on us, i'm going right by my target and i'll see you at my glorious WALMART on route 22 in watchung, new jersey. >> caller: ba, ba boo-yah, boo-yah, jim! >> boy, that's a stuttering boo-yah and a double boo-yah. It's tuesday. That could take the cake for the week, though. …” …more details…
6:35:38 PM WMT $48.30 Wal-Mart Stores, Inc.
Mad Money
11 days ago (06/16)
“…And if it were to power higher, if gasoline goes higher, if it goes above $3, goes back to $4, retail will will, except for WALMART, which comes right back down to the trade downplay. The other issue with the call is the analyst shapira, who I think is really, really good, someone with generally a terrific track record, may have come in a day late and a dollar short on this call. I think she should have downgraded WALMART at the beginning of the year when gas prices were really low and going for aggressive plays like target months ago. Plus, last week, home depot just said things are less bad. More ammo for the not getting …” …more details…
View All Wal-Mart Stores, Inc. News

Key Fundamentals

WMT - Wal-Mart Stores, Incorporated Fundamentals
Price (6/26 4:02PM) $48.63
Volume (6/26 4:02PM) 20.5 Million
Last Close Price $49.15
10 Day Average Volume 18.6 Million
13 Week Price Range $47.64 - $54.57
52 Week Price Range $46.25 - $63.85
LTM Revenue $401.5 Billion
 
Shares Outstanding (01/2009) 3.9 Billion
Market Capitalization $189.5 Billion
Shares Held By Institutions 1.5 Billion
Institutional Holders 1,763
% Shares Held By Institutions 39.30%
Earnings Per Share (EPS) $3.39
P/E Ratio 14.30
Book Value Per Share $16.40
 
Gross Margin 25.80%
Annual Dividend 1.09
Dividend Yield 2.20%
Beta 0.20
Fiscal Year Ends January

About Wal-Mart Stores, Inc.

Wal-Mart Stores, Incorporated is considered to operate in the Services sector. They specifically operate in the Discount, Variety Stores business segment contained within the Retail industry.

The Company operates Walmart discount stores, supercenters, Neighborhood Markets and Sam’s Club locations in the United States.

NASDAQ 1838.22

8.68  0.47%
S&P; 500 918.9

-1.36  -0.15%
^DIA 84.27

-0.45  -0.53%