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Wal-Mart Stores, Inc. (WMT) Buy or Sell Stock Guide
Are you looking for the analysis of Wal-Mart Stores, Inc. (WMT) stock? Are you wondering what the bulls and the bears say about it?
If so, you came to the right place. In this stock guide, we will share with you 5 reasons to buy and 8 reasons to sell WMT stock. You’ll get a perspective on what the bulls and the bears say about it.
The analysis below may be also helpful to you if you have any of the following questions about WMT stock:
- Is WMT a buy or a sell?
- Should I sell or hold WMT stock today?
- Is WMT a good buy / investment?
- What are WMT analyst opinions, recommendations and ratings?
Let’s start with the bull case. Here are the reasons to buy WMT stock:
1. Walmart is adapting very well to the changing consumer sentiment to compete with brick-and-mortar rivals and e-commerce giant Amazon. In this regard, the company has been taking several e-commerce initiatives. Walmart completed the acquisition of the Indian e-commerce company Flipkart in August 2018.
2. The company has maintained its leadership position in the US groceries business. Walmart's tie-up with Jet.com and Blue Apron shows the company's commitment to keeping competition at bay.
3. Walmart has a stable financial position. It has given good returns to the shareholders in the form of dividend payments and share buybacks.
4. WMT forward dividend yield is 1.81%, higher than the industry (0.63%) and sector (0.41%) forward dividend yields. See WMT forward dividend chart.
5. WMT average analyst rating is Buy. See WMT analyst rating chart.
Now that you understand the bull case, let’s look at the reasons to sell WMT stock (i.e., the bear case):
1. Walmart has been increasing investments in the highly competitive e-commerce market. However, the margins are coming down and the company might report lower margins in the coming quarters.
2. Walmart's return on investments might be low because of intense competition, trade wars, and also government regulations. Walmart also faces challenges due to the new e-commerce rules in India.
3. Walmart has always remained under pressure from the government agencies. Recently the company was criticized for the massive buyback which could be otherwise used to raise wages of its employees.
4. WMT stock price ($120.98) is at the 52-week high. Perhaps now is a good time to sell? See WMT price chart.
5. WMT quarterly revenue growth was 1.80%, lower than the industry and sector average revenue growth (4.08% and 2.27%, respectively). See WMT revenue growth chart.
6. WMT profitability is declining. The YoY profit margin change was -0.84 percentage points. See WMT profitability chart.
7. WMT PEG ratio (P/E adjusted for growth) is 5.23, and it’s high compared to its industry peers’ PEG ratios. See WMT PEG chart.
8. WMT short interest (days to cover the shorts) ratio is 3.28. The stock garners more short interest than the average industry, sector or S&P 500 stock. See WMT short interest ratio chart.
Now let's look at the key statistics for WMT:
|Average Price Target / Upside||$125.18 / 3.75%|
|Average Analyst Rating||Buy|
|Number of Employees||2,300,000|
|Forward P/E Ratio||23.43|
|YoY Quarterly Revenue Growth||1.8%|
What are your thoughts on WMT?
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