Is Wal-Mart’s Stock a Buy Now?

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E = Equity to Debt Ratio Is Normal

The debt-to-equity ratio for Wal-Mart is normal. The balance sheet could use some improvement, but we’re talking about Wal-Mart. If there’s one negative balance sheet that you don’t have to worry about, it’s this one. Also keep in mind that Wal-Mart has over $27 billion in operating cash flow.  

Debt-To-Equity

Cash

Long-Term Debt

WMT

.73

$8.64 Billion

$57.13 Billion

TGT

1.14

$1.47 Billion

$18.55 Billion

COST

.11

$4.85 Billion

$1.38 Billion

 

T = Technicals on the Stock Chart Are Strong

Wal-Mart has performed well over the past three years. Over that timeframe, it’s up over 42 percent, which especially impressive considering a 2.20 percent yield. Target Corporation (NYSE:TGT) might have a slightly higher yield of 2.30 percent, but Target has underperformed Wal-Mart over the past few years. Costco (NASDAQ:COST), on the other hand, has outperformed Wal-Mart by a wide margin in the same timeframe.

1 Month

Year-To-Date

1 Year

3 Year

WMT

.58%

24.02%

27.08%

42.52%

TGT

.21%

23.40%

18.15%

39.81%

COST

11.55%

28.96%

27.35%

85.72%

 

At 72.30, Wal-Mart is currently trading below its 50-day SMA and 100-day SMA, but above its 200-day SMA.

50-Day SMA

73.07

100-Day SMA

73.26

200-Day SMA

68.27

 

E = Earnings and Revenue Are Steady

Wal-Mart continues to grow at a very steady rate.

2008

2009

2010

2011

2012

Revenue ($)in billions

377.02

404.25

408.08

421.85

446.95

Diluted EPS ($)

3.13

3.39

3.71

4.47

4.52

 

Quarterly earnings and revenue have also been consistent. Q3 YoY is an example of continued growth.   

10/2011

1/2012

4/2012

7/2012

10/2012

Revenue ($)in billions

110.23

123.17

113.02

114.30

113.93

Diluted EPS ($)

.96

1.50

1.09

1.18

1.08

 

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