Walmart (WMT): Examining the Retail Giant’s Valuation After a Flat Trading Session

The latest trading session for Walmart (WMT) closed with little movement, leaving investors to assess what is next for the retail giant. Despite flat returns over the past week, Walmart’s long-term performance remains a point of interest.

See our latest analysis for Walmart.

Walmart’s share price has edged up more than 13% year-to-date, underscoring gradual but steady momentum after a year marked by resilient consumer demand and efficiency pushes. Even more telling, shareholders have seen a robust 28% total return over the past twelve months, which helps reinforce Walmart’s reputation for delivering value in both the short and long run.

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With Walmart continuing to deliver strong returns and modest growth, the question remains: is the current share price reflecting the company’s true potential, or could there still be room for savvy investors to benefit?

Most Popular Narrative: 9% Undervalued

With analysts setting Walmart’s fair value at $112 and the market closing at $101.84, sentiment sees untapped potential still priced in.

Expansion of high-margin business streams such as Walmart Connect (advertising, up 31-46% globally), marketplace, and Walmart+ memberships (global advertising up 46%, membership income up 15%) is diversifying Walmart's income base beyond retail. This is gradually transforming the company's profit mix and resulting in structurally higher net margins and earnings over time.

Read the complete narrative.

Curious what’s fueling that bold valuation forecast? It’s not just retail strength. The narrative hints at critical margin shifts and future income streams that could transform Walmart’s financial trajectory. One assumption underpins everything. Uncover the big story details that are moving the market’s view.

Result: Fair Value of $112 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, persistent international losses and rising delivery costs could slow Walmart's margin gains and present challenges to upbeat forecasts if left unresolved.

Find out about the key risks to this Walmart narrative.

Another View: Multiples Tell a Different Story

While analysts see Walmart as undervalued based on future cash flows, a look at its current price-to-earnings ratio reveals a much pricier picture. Walmart trades at 38x earnings, noticeably higher than the industry average of 20.5x and the fair ratio of 31.9x. This gap highlights potential valuation risk if growth does not keep pace. Is the market overly optimistic, or is Walmart’s premium deserved?

See what the numbers say about this price — find out in our valuation breakdown.

Build Your Own Walmart Narrative

If you’d rather investigate the numbers yourself or shape your own interpretation, you can easily build your own Walmart narrative in just a few minutes: Do it your way

A great starting point for your Walmart research is our analysis highlighting 3 key rewards and 1 important warning sign that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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