With a yield of 0.81%, retail giant Walmart (SYM: WMT) is still attractive.
Helping, the company just paid out its 21-cent dividend on January 6 with another one expected by April. According to Walmart, it has now “increased its annual cash dividend every year since first declaring a $0.05 per share annual dividend in March 1974.”
Also, analysts at Barclays just raised their price target to $98 from $90 with an overweight rating. Bernstein analysts also raised their price target to $106 from $102 with an outperform rating. Bernstein “expects renewed inflationary pressure on the back of potential tariffs and wage inflation in 2025, which is a net positive for mass/club retailers, a net neutral for dollar retailers as consumers’ need to trade down is offset by higher labor costs,” per TipRanks.com.
Earnings have been solid, too.
In its most recent quarter, Walmart EPS of 58 cents beat estimates by five cents. Revenue of $169.6 billion, up 5.5% year over year, beat by $2.98 billion. Global e-commerce sales were up 27%. U.S. comparable sales were up 5.3%. Operating cash flow was $22.9 billion, an increase of $3.9 billion. Free cash flow was $6.2 billion, an increase of $1.9 billion. WMT also bought back 46 million shares, of $3 billion worth of stock.
The company also raised its guidance for 2025 with net sales expected to grow 4.8% to 5.1%. Adjusted operating income is also expected to grow about 8.5% to about 9.25%.
In addition, as noted by President and CEO Doug McMillon, “We had a strong quarter, continuing our momentum. Our associates are working hard to save people time and money and to transform our business. In the U.S., in-store volumes grew, pickup from store grew faster, and delivery from store grew even faster than that. Our teams are executing and delighting our customers and members with the value and convenience they expect from Walmart,” as quoted in the company’s earnings press release.
In short, with a yield of 0.81%, Walmart (WMT) is still an attractive opportunity – especially with its recent pullback. With strong earnings growth bullish analysts, and consistent dividend increases since March 1974, WMT is a safe, long-term investment opportunity.
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