Equity Valuation of WalMart

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EQUITY VALUATION – WALMART

Equity valuation is a major tool used to analyse investment choices using the company’s past and current performance, in addition to its business plans, in order to forecast its future financial position and valuate the stock. This paper will examine and valuate Walmart based on my projection for the company’s performance over the next few years.

SECTION I

Wal-Mart Stores, Inc., branded as Walmart and traded on the NYSE as WME, is a multinational retail corporation headquartered in Bentonville, Arkansas (United States). The company, which is currently the world’s largest corporation by consolidated revenue and the world’s biggest employer, runs chains of large discount stores and warehouse stores in the US and in 26 other countries. The company was founded in 1962 by Sam Walton and still remains as a family-owned business. As of June 2013, the Walton family owned at least 50.9% of outstanding shares, up from 39% a decade ago.

Walmart is a retailer that belongs to the consumer staples sector and is currently the leader in the US retail market, accounting for 11.3% of all US sales. The company operates largely in three segments: Walmart USA, which accounted for 58.89% of the company’s sales revenue in 2013, Walmart International, which accounted for 29.01% of the sales revenue, and Sam’s Club, accounting for 12.10% of the total. The company operates in twenty six foreign countries through Walmart International, and Sam’s Club operates as a membership-based discount wholesaler in the US. In total, the company currently has around 11,000 retail units under 69 different banners in 27 countries and also has online stores in 10 countries.

Walmart USA’s strategy centres around its Everyday Low ...

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...Feet, 2008. Beat the Street: Investment Banking Interviews, 2008 Edition, WetFeet, Chapter 3

Coleman-Lochner, A., Rupp, L., Patton, L., December 1st, 2013. U.S. Retail Holiday Sales Up 2.3%, Foot Traffic Declines. Reuters. [Online]: http://www.bloomberg.com/news/2013-11-30/black-friday-traffic-seen-thinning-as-stores-open-early.html

Chowdhury, S., January 07, 2014. Market price-earnings ratio at three-year high, The Daily Star. [Online]: http://www.thedailystar.net/business/market-price-earnings-ratio-at-three-year-high-5714

Annual Reports 2004. [Online]

Annual Report 2005. [Online]

Annual Report 2006. [Online]

Annual Report 2007. [Online]

Annual Report 2008. [Online]

Annual Report 2009. [Online]

Annual Report 2010. [Online]

Annual Report 2011. [Online]

Annual Report 2012. [Online]

Annual Report 2013. [Online]

Annual Report 2014. [Online]

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