4-Star Stocks Poised to Pop: Wal-Mart
Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, retail behemoth Wal-Mart Stores (NYS: WMT) has earned a respected four-star ranking.
With that in mind, let's take a closer look at Wal-Mart's business and see what CAPS investors are saying about the stock right now.
Wal-Mart facts
Headquarters (Founded) | Bentonville, Ark. (1945) |
Market Cap | $194.3 billion |
Industry | Discount retail |
Trailing-12-Month Revenue | $431.87 billion |
Management | CEO Michael Duke (since 2009) CFO Charles Holley (since 2010) |
Return on Equity (Average, Past 3 Years) | 22% |
Cash/Debt | $8.1 billion / $57.1 billion |
Dividend Yield | 2.6% |
Competitors | Amazon.com (NAS: AMZN) Target (NYS: TGT) Costco Wholesale (NAS: COST) |
Sources: S&P Capital IQ and Motley Fool CAPS.
On CAPS, 89% of the 7,047 members who have rated Wal-Mart believe the stock will outperform the S&P 500 going forward. These bulls include tbonci and TarynOne.
A few months ago, tbonci listed several of Wal-Mart's positives:
They have a high RoE, gobs of cash, a 7.9% earnings yield, and a low P/Sales and P/E. Looking toward future potential, Wal-Mart is seeking expansion into untapped developing markets. ... [M]anagement clearly has their eyes set on moving to the large global stage, which will only be good for shareholders.
In fact, Wal-Mart currently sports a cheapish forward P/E of 11.5. That represents a discount to fierce competitors Amazon (73.0), Target (12.4), and Costco (19.0).
CAPS member TarynOne elaborates on the bargain opportunity:
[Wal-Mart] is somewhat out of favor in the US as of late and same-store sales are slightly down. ...
I think the market, however, has its needle stuck on [Wal-Mart's] less-than-popular reputation in the US and is forgetting the fact that [Wal-Mart] has HUGE growth potential abroad (excluding Europe) in emerging market. [Wal-Mart] is just tapping the surface here and I think it will be a great long term bet.
What do you think about Wal-Mart, or any other stock for that matter? If you want to retire rich, you need to put together the best portfolio you can. Owning exceptional stocks is a surefire way to secure your financial future, and on Motley Fool CAPS, thousands of investors are working every day to find them. CAPS is 100% free, so get started!
Interested in another easy way to track Wal-Mart?Add it to your watchlist.
At the time thisarticle was published Fool contributor Brian Pacampara owns no position in any of the companies mentioned. The Motley Fool owns shares of Wal-Mart and Costco. Motley Fool newsletter services have recommended buying shares of and creating a diagonal call position in Wal-Mart, as well as buying shares of Costco. Try any of our Foolish newsletter services free for 30 days.We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Fool's disclosure policy always gets a perfect score.
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