Wal Mart Stock Analysis
I. Executive Summary
The purpose of this report is to evaluate the stock price of Wal-Mart Stores Inc. (which ticker symbol in NYSE is WMT) by fundamental analysis. According to this analysis, I recommend that Wal-Mart is worth to invest in the long term because of the potential growth of market shares and revenue. Besides, based on P/E method and Gordon model, WMT price is undervalued; therefore, if investors buy the stock, they will get benefit not only in capital gain but also in dividend cash inflow.
II. Introduction of Wal-Mart Stores Inc. (WMT)
Wal-Mart, founded by Sam Walton in 1962, is the world’s largest retailer and public corporation. It operates over 6,500 stores worldwide, employs 1.9 million associates, and serves more than 176 million customers each week around the world. The company offers a broad assortment of quality commodities and services and its purpose is “saving people more money so they can live better.” Wal-Mart owns Wal-Mart Supercenters which are discount and grocery stores, SAM’S Clubs which are membership-only warehouse stores, and Neighborhood Markets which are smaller grocery stores. The company faces many major competitors such as Costco Wholesale, Target, Cost-U-Less, Sears Holding, and Dollar General in the USA and Carrefour which come from France in worldwide.
Wal-Mart was listed on the New York Stock Exchange (its ticker symbol is WMT) with an initial stock price of 32.50 per share on August 25, 1972 and distributed its first cash dividend $0.0001 per share on March 13, 1974. Besides, it is included in some index such as Dow Jones Composite, Dow Industrials, S&P 100, S&P 500, and S&P 1500 Super Comp. The company revenue is 378.80 billion and EPS is 3.13 from 2007. (shown in appendix 3)
Some analysts think Wal-Mart would continue to successful in increasing profit for two reasons. One was an increase in Supercenters which were projected to grow from about 60 percent of Wal-Mart’s selling space to 75%. It was thought that
The purpose of this report is to evaluate the stock price of Wal-Mart Stores Inc. (which ticker symbol in NYSE is WMT) by fundamental analysis. According to this analysis, I recommend that Wal-Mart is worth to invest in the long term because of the potential growth of market shares and revenue. Besides, based on P/E method and Gordon model, WMT price is undervalued; therefore, if investors buy the stock, they will get benefit not only in capital gain but also in dividend cash inflow.
II. Introduction of Wal-Mart Stores Inc. (WMT)
Wal-Mart, founded by Sam Walton in 1962, is the world’s largest retailer and public corporation. It operates over 6,500 stores worldwide, employs 1.9 million associates, and serves more than 176 million customers each week around the world. The company offers a broad assortment of quality commodities and services and its purpose is “saving people more money so they can live better.” Wal-Mart owns Wal-Mart Supercenters which are discount and grocery stores, SAM’S Clubs which are membership-only warehouse stores, and Neighborhood Markets which are smaller grocery stores. The company faces many major competitors such as Costco Wholesale, Target, Cost-U-Less, Sears Holding, and Dollar General in the USA and Carrefour which come from France in worldwide.
Wal-Mart was listed on the New York Stock Exchange (its ticker symbol is WMT) with an initial stock price of 32.50 per share on August 25, 1972 and distributed its first cash dividend $0.0001 per share on March 13, 1974. Besides, it is included in some index such as Dow Jones Composite, Dow Industrials, S&P 100, S&P 500, and S&P 1500 Super Comp. The company revenue is 378.80 billion and EPS is 3.13 from 2007. (shown in appendix 3)
Some analysts think Wal-Mart would continue to successful in increasing profit for two reasons. One was an increase in Supercenters which were projected to grow from about 60 percent of Wal-Mart’s selling space to 75%. It was thought that
References: 1. Jeff Madura, Financial Markets and Institutions 8th Edition, published by Thomson South-western 2. Bodie, Kane, Marcus, Investments 7th Edition, published by Mc Graw Hill 3. http://finance.aol.com/charts/wal-mart-stores-inc/wmt/nys 4. http://finance.yahoo.com/q/ks?s=WMT 5. http://www.investorguide.com/stock-profile.cgi?ticker=WMT 6. http://www.chart-dow-stocks.com/wal-mart-stores-stock.html