Analyzing Walmart (WMT) and The Competition

Walmart (NASDAQ:WMT) is one of 149 publicly-traded companies in the “Consumer Staples Distribution & Retail” industry, but how does it compare to its peers? We will compare Walmart to related businesses based on the strength of its dividends, analyst recommendations, profitability, earnings, institutional ownership, risk and valuation.

Profitability

This table compares Walmart and its peers’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Walmart	3.00%	21.83%	7.80%
Walmart Competitors	-25.86%	4.03%	2.94%

Dividends

Walmart pays an annual dividend of $0.99 per share and has a dividend yield of 0.8%. Walmart pays out 35.7% of its earnings in the form of a dividend. As a group, “Consumer Staples Distribution & Retail” companies pay a dividend yield of 3.8% and pay out 37.2% of their earnings in the form of a dividend. Walmart has increased its dividend for 53 consecutive years.

Insider & Institutional Ownership

26.8% of Walmart shares are held by institutional investors. Comparatively, 45.0% of shares of all “Consumer Staples Distribution & Retail” companies are held by institutional investors. 0.1% of Walmart shares are held by company insiders. Comparatively, 19.7% of shares of all “Consumer Staples Distribution & Retail” companies are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Earnings and Valuation

This table compares Walmart and its peers top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Walmart	$713.16 billion	$21.89 billion	45.31
Walmart Competitors	$34.73 billion	$846.26 million	17.25

Walmart has higher revenue and earnings than its peers. Walmart is trading at a higher price-to-earnings ratio than its peers, indicating that it is currently more expensive than other companies in its industry.

Risk & Volatility

Walmart has a beta of 0.53, indicating that its share price is 47% less volatile than the S&P 500. Comparatively, Walmart’s peers have a beta of 0.44, indicating that their average share price is 56% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and target prices for Walmart and its peers, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Walmart	0	2	39	3	3.02
Walmart Competitors	2243	8275	10063	459	2.42

Walmart presently has a consensus price target of $129.62, indicating a potential upside of 3.26%. As a group, “Consumer Staples Distribution & Retail” companies have a potential upside of 59.45%. Given Walmart’s peers higher possible upside, analysts clearly believe Walmart has less favorable growth aspects than its peers.

Summary

Walmart beats its peers on 11 of the 15 factors compared.

About Walmart

Walmart Inc. engages in the operation of retail, wholesale, other units, and eCommerce worldwide. The company operates through three segments: Walmart U.S., Walmart International, and Sam's Club. It operates supercenters, supermarkets, hypermarkets, warehouse clubs, cash and carry stores, and discount stores under Walmart and Walmart Neighborhood Market brands; membership-only warehouse clubs; ecommerce websites, such as walmart.com.mx, walmart.ca, flipkart.com, PhonePe and other sites; and mobile commerce applications. The company offers grocery and consumables, including dairy, meat, bakery, deli, produce, dry, chilled or frozen packaged foods, alcoholic and nonalcoholic beverages, floral, snack foods, candy, other grocery items, health and beauty aids, paper goods, laundry and home care, baby care, pet supplies, and other consumable items; fuel, tobacco and other categories. It is also involved in the provision of health and wellness products covering pharmacy, optical and hearing services, and over-the-counter drugs and other medical products; and home and apparel including home improvement, outdoor living, gardening, furniture, apparel, jewelry, tools and power equipment, housewares, toys, seasonal items, mattresses and tire and battery centers. In addition, the company offers consumer electronics and accessories, software, video games, office supplies, appliances, and third-party gift cards. Further, it operates digital payment platforms; and offers financial services and related products, including money transfers, bill payments, money orders, check cashing, prepaid access, co-branded credit cards, installment lending, and earned wage access. Additionally, the company markets lines of merchandise under private brands, including Allswell, Athletic Works, Equate, and Free Assembly. The company was formerly known as Wal-Mart Stores, Inc. and changed its name to Walmart Inc. in February 2018. Walmart Inc. was founded in 1945 and is based in Bentonville, Arkansas.