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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Walmart Inc. (XNYS:WMT) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
WMT
Name:
WALMART INC. (XNYS:WMT)
Sector:
644.00M
Industry:
Discount Stores
CEO:
Mr. C. Douglas McMillon
Total Employees:
2,300,000
Our Technological Advancement Rating
Our Rating:
A+
Technological advancement compared to industry is 1939.62% higher
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF WALMART INC.(WMT) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND DISCOUNT STORES INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
133
One Month Price Target:
$133.39
Six Month Price Target :
$135.37
Likely Price in One Year's Time:
Ticker:
$137.73
Likely Trading Range Today Under (Normal Volatility)
$132.67
Price Upper limit ($) :
$133.41
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$128.58
This week:
$123.12
This month :
$113.24
Other Primary facts
Market Cap:
359.53B
Market Cap Classification:
Large Cap
Number of Shares
IPO Date:
2.71B
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
11.71%
-11.38%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$153.51
$144.10
$112.49
$121.90
Medium risk (<10%) entry points
Buy Call
Sell Call
$141.03
Buy Put:
Sell Put:
$139.02
$124.94
$126.98
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
WMT
Sharpe Ratio:
1.27%
Comparison:
WMT, is amongst the top 60% stocks with highest risk-adjusted returns
Sharpe ratio is -45.41% lower than the industry
& is -44.48% lower than the market/S&P 500 average
Average Returns/Yield of
WMT
Daily returns:
0.03%
Weekly returns:
0.15%
Monthly returns:
0.59%
Yearly returns:
13.35%
Comparison of returns:
Average annual returns/yield (last 3 years) is -46.96% below industry average
Classification:
WMT, is amongst the top 60% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.76
Statistical test of Returns:
WMT has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
1.63%
Weekly Volatility:
3.65%
Monthly Volatility:
7.30%
Yearly Volatility:
25.28%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
1.07%
Volatility in last five trading days has been -34.56% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-3.32%
Weekly VaR:
-7.43%
Monthly VaR:
-14.86%
How Much Can the price of
WMT
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-13%
Worst case (decline):
-51.47%
This translates to price declining to:
$115.97
This translates to price declining to:
$64.54
Severe Crash Probability
Risk of crash in next 6/12 months: Medium (<50%)
What is Value at Risk (VaR)?
Risk Fundamentals
WMT is a 4.87% riskier investment compared to the market/S&P 500 & is -10.16% less risky than Nasdaq(IXIC)
Risk (measured by volatility) is -26.69% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
WMT
Beta in relation to market/S&P 500--0.53
Expected beta in 1 year's time:
0.583
Expected beta in 3 year's time:
0.824
Unlevered (debt free) Beta:
0.343
Beta in relation to Nasdaq (XNAS):
0.383
Beta in relation to all global stocks::
0.405
Beta Comparison & Analysis
Beta of competitors/peers::
0.784
Beta is -32.44% lower than peers
Average Industry Beta:
0.701
Beta is -24.46% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
5.57%
Sustainable growth rate is -71.38% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
0.003
Alpha is -94.39% below industry average alpha yield
Alpha is 19% compared to market & is healthy
Analysis of Cost of Capital of
WMT
Equity cost of capital:
0.068
Equity cost of capital is -14.77% below industry mean WACC
Unlevered (without debt) cost of capital:
4.39%
Before-tax cost of debt:
2.27%
After-tax cost of debt:
1.80%
Overall debt rating:
Highest AAA investment grade
Weighted average cost of capital (WACC):
1.80%
WACC is -9.44% below industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$212.22
Revenue growth rate per share of (3Y):
4.27
Annual revenue growth rate is -47.11% below industry average
EPS:
$4.65
Expected Annual growth rate of EPS (3Y):
28.78%
Expected future EPS growth rate is 52.15% higher than the Discount Stores industry
Free cash flow (FCF) per share:
$1.12
Balance sheet equity growth per share: 5.65%
Equity growth rate per share is -94.94% lower than the industry
Debt per share
$21.00
EBITDA per share
$10.91
Valuation Analysis Today of
WMT
P/E Ratio:
26.55
P/E Ratio of Competitors/Peers:
26.23
P/E ratio is 1.22% higher than main peers & is 14.45% higher than the industry
Stock price/value with industry average P/E ratio: $107.87
WMT is 23.30% overvalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $55.67
Present value of the expected future dividends only: $35.90
P/S (Price to Sales ratio):
0.63
Price to sales ratio is -39.72% below the industry mean
P/B (Price to book value ratio):
4.27
Price to free cash flow: 118.53
Price to free cash flow ratio is -66.31% lower than the industry
Net income growth rate (3Y):
44.93%
Net income growth rate is -9.07% lower than the industry average net income growth rate
Dividend Analysis
Dividend payout rate: 11.92%
Dividend yeild: 1.67%
Previous Dividend: $0.56
Previous adjusted dividend: $0.56
Previous Dividend: $2.22
Expected next dividend best case: $0.57
Expected next dividend worst case: $0.55
Average dividend payment (long-term): $0.55
Average dividend increase/decrease (growth rate) % per period: 0.56%
Expected next dividend payment date: 29/08/2022
Expected next dividend record date: 08/04/2022
Expected next dividend declaration date: 18/05/2022
Previous dividend payment date: 31/05/2022
Previous dividend record date: 05/06/2022
Previous dividend declaration date: 17/02/2022
Dividend History:
2022-05-05--$0.56
2021-12-09--$0.55
2021-05-06--$0.55
2022-03-17--$0.56
2021-08-12--$0.55
2021-03-18--$0.55
Dividend growth rate is -98.72% lower than the industry average
In-depth Debt & Leverage Analysis
Debt to equity ratio:
72.77%
Net debt to equity ratio:
51.03%
Debt to assets ratio:
24.10%
Net debt to assets ratio:
16.90%
Debt-to-asset ratio is -63.15% below industry average
Ability to repay debt:
Interest coverage ratio:
20.74
Interest coverage ratio is -92.11% less than industry average
Looking forward:
Debt growth rate:
-12.68%
Annual debt growth is -100% lower than industry average debt growth rate
Debt repayment rate in last quarter: 0.89%
Analysis of Key Statistics
Correlation of price movement with the market:
0.466
Statistical significance of correlation:
WMT has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.493
Stock price is -5.49% less correlated with the market compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.493
Correlation of price movement with Nasdaq (^IXIC):
-0.003
Covariance of price movement with the market:
-0.003
Kurtosis
12.626
Returns have severe fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are considerably more likely, compared to assets with normally distributed returns
Skewness of returns:
0.072
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
WMT
Gross Profit Margin Ratio:
100%
Operating Profit Margin Ratio:
4.23%
Operating profit margin is -17.19% lower than the industry
Net Profit Margin Ratio:
100%
Effective Tax Rate:
25.47%
Effective tax rate is -3.92% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
16.59%
Return on equity (ROE) is -31.32% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
5.49%
Return on assets (ROA) is -29.30% lower than the industry
Financial Leverage:
1.3x
Current Ratio:
0.95
Current ratio is -27.68% below industry average
Cash Conversion Cycle (days):
-29.9
Cash conversion cycle is -159.50% below industry average
The remaining useful life of property plant & equipment is: 10.6 years
Stock based compensation to net income ratio:
-
In-depth Efficiency Analysis
Revenue generated per employee:
250.4K
Each employee generates -33% less revenue than industry average revenue per employee
EBITDA generated per employee:
12.9K
Each employee generates -52% less EBITDA than industry average revenue per employee
Profit generated per employee:
5.7K
Each employee generates -63% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
0.3K
Each employee generates -74% less free cash flow than industry average revenue per employee
Assets/Capital per employee
69.6K
Each employee generates -74% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
WMT
THE PROCTER & GAMBLE COMPANY (XNYS:PG)
THE COCA-COLA COMPANY (XNYS:KO)
Philip Morris International Inc. (XNYS:PM)
THE ESTEE LAUDER COMPANIES INC. (XNYS:EL)
DIAGEO PLC (XNYS:DEO)
TARGET CORPORATION (XNYS:TGT)
Anheuser-Busch Inbev SA (XNYS:BUD)
Altria Group, Inc. (XNYS:MO)
BRITISH AMERICAN TOBACCO P.L.C. (XNYS:BTI)
Current Analyst Ratings
Strong buy�33%
Buy�29%
Hold�63%
Sell�4%
Strong sell�4%
Overall analyst sentiment is: Hold
Income Statement
Period:
TTM
Date:
4/30/22
Revenue:
576.01B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
432.58B
143.44B
-
-
119.09B
-
-
119.09B
164.00M
1.43B
10.68B
29.62B
24.35B
13.00B
17.75B
4.52B
13.00B
Statement of Cash Flow
Date:
Period:
2.66B
Differed Income Tax :
- 155000.00K
Stock Based Compensation :
-
Change in Working Capital :
- 5239000.00K
Accounts Receivables:
-
Other Working Capital:
- 4250000.00K
Other Non-Cash Items:
2.86B
Net Cash Provided by Operating Activities:
2.86B
Investments in PP&E:
- 2214000.00K
Net Acquisitions:
7.94B
Purchases of Investments:
-
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
4/30/21
2022
Q1
22.85B
-
22.85B
5.80B
46.38B
1.57B
76.59B
108.63B
28.87B
-
-
-
22.49B
159.99B
-
236.58B
48.15B
5.82B
851.00M
-
26.87B
80.84B
57.01B
-
71.15B
-
151.99B
280.00M
82.58B
- 7946000.0K
3.42B
April 30, 2021 at 6:00:00 AM
551.66B
78.34B
230.32B
-
62.82B
40.0B
-
129.00M
5.85B
- 510000.00K
-
- 2809000.00K
- 1549000.00K
- 531000.00K
- 5399000.00K
- 51000.00K
5.11B
22.89B
17.79B
2.86B
- 2214000.00K
644.00M
Our Proprietary Portfolio Rating
Our Rating:
A+
Price Forecast/Expected Price in Next 5 Years of
WMT
2023
2024
2025
2026
2027
$165.10
$170.97
$177.06
$183.36
$189.89