How Much Is Walmart Worth and Should You Invest in It?

ByG. Dautovic
March 18, 2022

Walmart is the most successful retailer in history. The brand’s first stores opened in 1962, and since then, it’s gone from strength to strength. Today, the company is helping consumers all over the world save money on their groceries, banking, and online shopping. 

In this post, we ask: How much is Walmart worth? We then go on to talk more about the company’s history, its future growth predictions, and whether it’s worth investing in. 

How Much Is Walmart Worth in 2022?

Walmart’s market cap changes regularly as the stock price changes. In March 2022, the total value of the company’s shares was $403.18 billion, down from $410.35 billion in 2021 and $407.84 billion in 2020, but up significantly from $337.16 billion in 2019 and $270.62 billion in 2018.

Ten years ago, Walmart’s total market cap was just $228.24 billion – less than two-thirds of what it is today. 

Walmart has seen tremendous growth in its share price since it first began trading company stock publicly in 1970. Most of the increases in the brand’s market cap came in two phases: during the dot-com boom of the late 1990s, and during the recent bull market rally, from 2017 onward.

The current share price is $145, up from less than a dollar 50 years ago (when you take share splitting into account). 

Walmart Financials

Walmart’s most recent financials make for impressive reading. The company is currently clawing back business that it lost due to lockdowns and shelter-in-place orders during 2020 and 2021.

Walmart’s revenue and profits are $152.87 billion and $5.89 billion, respectively, for the quarter running to January 2022. The company improved its net profit margin to 2.33%, up from 2.21% in the previous quarter. Walmart’s operating income rose significantly from a down year in 2021.

Jan 2022 Financials

USD

Y/Y Growth

Revenue

152.87B

0.52%

Net income

3.56B

270.35%

Diluted EPS

1.28

272.97%

Net profit margin

2.33%

270.07%

Operating income

5.89B

9.25%

Net change in cash

-1.33B

139.06%

Cash on hand

-

-

Cost of revenue

115.52B

0.23%

Walmart generates yearly revenue of over $559 billion. Walmart’s annual gross profit is estimated to be $143.75 billion this year, an increase of 3.545% over the 2021 figure of $138.836 billion, which, itself, is a significant increase over the 2020 figure of $129.35 billion posted during the height of COVID-19-related restrictions. 

Why Is Walmart So Valuable?

Despite already being a large and well-established company, Walmart remains valuable because of its growth prospects. It’s still exploring new opportunities to bring in additional revenue. 

Walmart is also a highly diversified company. It has many assets, divisions, and services besides its core grocery offering. Today, you can walk into one of the brand’s stores and get clothing, gardening equipment, tools, car mats, homewares, DVDs, TVs, and practically any other consumer product imaginable. 

Walmart is also spearheading its financial services. MoneyCard is a debit card that doesn’t require a bank account, Walmart-2-Walmart is a money sending service that allows quick transfers, and Walmart Financial Services offers things like money orders, check printing, and bill paying. 

Opening large numbers of stores in other countries impacts the brand’s share price, too. It’s currently buying up local retail chains and then implementing its management model to improve the service they offer to customers. 

The company’s global footprint is tremendous. In the first quarter of 2022, it had over 10,500 stores across the world, and the number of people Walmart employs is over 2.3 million. The majority of the company’s payroll – nearly 1.6 million – is in the US, making it the largest private employer in the country.

Walmart History

Walmart’s ascent began on July 2, 1962, when Sam Walton opened the brand’s first store in Rogers, Arkansas. He was obsessed with a simple, basic principle: offering customers the lowest price “anytime, anywhere.”

By 1967, the Walton family owned 24 stores and had racked up more than $12.7 million in sales. Come 1969, and the company was large enough for official incorporation as Wal-Mart Stores Inc. 

During the 1970s, Walmart expanded beyond Arkansas and went national. It began selling publicly traded shares and, in 1972, was large enough to be publicly traded on the New York Stock Exchange, with record sales of $78 million

In 1975, Walton visited a Korean manufacturing facility, which inspired him to introduce the “Walmart cheer,” a practice that involves employees chanting the letters of the word W-A-L-M-A-R-T and proclaiming their personal alignment with the firm’s values. 

During the 1980s, Walmart expanded even more, and sales topped $1 billion. The company now had 276 stores and more than 21,000 employees. In 1987, the Walton family established the Walton Family Foundation, an organization introduced to support K-12 education and protect the rivers and oceans of America. 

In the 1990s, Walmart hit $1 billion in sales per week. Sam Walton reiterated the company’s mission to improve people’s lives by lowering the price of goods but passed away in 1992, aged 74. 

In 1997, the company hit $100 billion in sales in a year for the first time. The following year, it bought UK retailer Asda, keeping the brand name. 

In 2000, Walmart saw a CEO change. H. Lee Scott Jr. succeeded David Glass. That same year, it established its online shopping platform, Walmart.com. 

In 2002, Walmart topped the Fortune 500 list of America’s largest companies by market cap for the first time, cementing its prominence in the US economy. That same year, it entered the Japanese market through its investment in Seiyu. 

In 2005, Walmart took a leading role in disaster relief after hurricanes Katrina and Rita. It sent more than 2,450 truckloads of supplies worth $18 million to victims and to support the community. 

Walmart also began evaluating the environmental impacts of its operations. It committed to creating zero waste, only using renewable energy and selling sustainable products. 

From the 2010s onward, Walmart set its sights on international expansion. The company, for instance, opened Bharti Walmart, a joint venture with an Indian firm. In 2011, it went to South Africa, acquiring 51% of Massmart Holdings Limited, giving the company more than 10,000 stores worldwide. 

In 2013, Walmart made a commitment to hire honorably discharged veterans in the first 12 months after active duty. It also stated that it would hire more than 100,000 veterans over the following five years. 

In 2015, the company had more than 2.3 million associates worldwide and was serving more than 200 million customers per week. 

In 2018, the company changed its legal name from Wal-Mart Stores, Inc. to simply Walmart Inc. Now the company is committed to raising the pay and benefits for more than 1 million associates, increasing hourly rates, and improving maternity and parental leave benefits. 

Should You Invest in Walmart Stocks?

The January 2022 report was a blowout quarterly report for Walmart. Net income and profit margins were up 270% year-on-year, underscoring the company’s rapid turnaround from the pandemic lows. However, that doesn’t necessarily mean you should invest in the brand long-term. 

In this section, we take a look at some of the traditional reasons why people buy Walmart stock and why you might want to avoid it. 

Pros of Owning Walmart Stock

Here are some of the reasons why you might want to own Walmart stock. 

  • It’s an innovation powerhouse

Walmart, as a company, is obsessed with innovation. Right from its founding, it wanted to do something different from other stores, like Kroger. 

When eCommerce came along, many commentators thought it would be the death knell for Walmart. However, the company proved responsive, setting up its own eCommerce store within months and introducing other consumer-friendly technology, such as “scan and go” for iOS and Android. Online sales increased 79% in 2020, underscoring the retailer’s digital readiness. 

  • It offers high dividends and smart reinvestment strategy

Walmart is a rare company that is both able to increase profits with its reinvestment strategy while, at the same time, giving back to shareholders. The company, for instance, plowed more than $10.7 billion into capital expenditures in 2020, while also handing out more than $6 billion to shareholders in the form of dividends. 

There’s no reason to assume that Walmart’s high performance will deteriorate anytime soon. The company has been increasing its annual dividend every year since 1974 (when it first started paying one). At the end of 2021, it was offering more than 1.55%, which is reasonable for a dividend stock, particularly given the brand’s rapid share price appreciation. 

  • It has stability and a trusted brand name

Walmart is a highly reliable company, churning out profits most years, except in exceptional circumstances, such as the pandemic, or because of one-off accounting reasons. It’s widely regarded as being one of the least volatile blue chips and a good choice for anyone looking to invest over a decade or more. Walmart’s daily volume is high, meaning that investors usually get close to the market price.

  • It has good growth prospects

Lastly, many investors believe that Walmart has long-term growth potential. The company is currently attempting to grow its international portfolio in Asian markets by backing existing brands. Instead of attempting to transplant its brand from the US to China, India, and South Africa, it’s instead buying local chains and then getting them to adopt its practices and management styles. 

Cons of Buying Walmart Stock

Of course, it’s not all plain sailing. Here are some of the downsides of owning Walmart stock: 

  • It’s not a growth stock

Walmart’s growth exploded during the 1980s, 1990s, and 2000s, thanks to its growing market. Wherever it opened a store in the US, customers came. 

However, the company is not a growth stock. It won’t be able to provide investors double-digit returns indefinitely. Therefore, it’s not a great choice for anyone looking to grow the value of their portfolio rapidly. 

  • It’s still battling with Amazon

Nobody quite knows which way the online retail war is going to go. Right now, it seems like Amazon has the upper hand, though Walmart is fighting back hard in the digital space with offerings of its own. There may be space in the market for both companies, but that is by no means guaranteed.

  • Higher minimum wages may erode earnings

If the US moves toward more of a high-wage economy, it may impact the company’s earnings. It may not be possible for Walmart to maintain good margins if the minimum wage rises, either because of government mandates or public pressure. 

  • A global economic downturn could hurt US consumer spending

Given rising inflation and political turmoil, US consumer spending may slow down. Just like any retailer, Walmart depends on Americans earning high enough incomes to buy its products. If consumption patterns change, Walmart could potentially find itself having to scale back. 

Walmart in Other Countries

Walmart operates in 24 countries outside of the US, under 48 banners. Walmart International has operations in:

  • Central America
  • Mexico
  • Canada
  • South Africa
  • China
  • India 

In Mexico and Central America, the brand is known as Walmart de México y Centroamérica. In India, it’s called Flipkart Wholesale, and in the other countries on the list, it’s wholly owned and operated. 

Walmart Leadership 

Doug McMillon is the president and CEO of Walmart Inc. and has been since 2014. He is responsible for the brand’s operations both in the US and worldwide. Before that, he was CEO of Walmart International between 2009 and 2014. 

The president and CEO of Walmart US is John Furner. He previously served as president and CEO of Sam’s Club and started at Walmart as a sales associate in 1993. 

The current president and CEO of Walmart International is Judith McKenna. She is the main leader of the brand’s footprint outside of the US, responsible for a team of more than 550,000 associates operating in 23 counties. 

McKenna oversees members of the international senior leadership team. These include: 

  • Chris Cyrenne, Senior Vice President and International Chief Ethics and Compliance offer 
  • Leigh Hopkins, Executive Vice President, International Strategy, Development and Asia Region
  • Deborah Vaughn, Senior Vice President and General Counsel, Walmart International
  • Amanda Whalen, Executive Vice President and Chief Financial Officer, Walmart International 

Future Growth Predictions

The Statista Research Department has recently released predictions of Walmart’s growth rate up to 2026. According to the report, Walmart’s sales will grow, year-on-year, by 4.8% in 2022, 4.7% in 2023, 4.2% in 2024, 3.9% in 2025, and 3.9% in 2026. It has recently revised upward its forecasts of future growth rates based on the decline in sales of -2.4% reported in 2021. 

CNN Business surveyed 33 forecasters to determine what is likely to happen to Walmart's stock price over the next 12 months. Figures suggest that it’ll rise from $145 per share today to a median of $165 in 12 months’ time, implying an increase of 16.5%. The 95% confidence interval runs from $136 to $190. 

Wrapping Up

While Walmart is still slightly down from its peak in 2020, the company is still highly valuable and one of the US’s largest companies. How much is Walmart worth? It is currently number 12 in the country, behind the likes of Apple, Microsoft, Google, Amazon, Tesla, Berkshire Hathaway, Facebook, Nvidia, and United Health. 

Whether Walmart will continue to grow at the rate it has been in future years remains to be seen. While the company is innovating and expanding internationally, many investors fear that there are limits to its growth. Walmart’s net worth is $429.337 billion, but it may not rise as fast as newer, more innovative companies.

FAQ

How much is an original share of Walmart worth?

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Walmart first began offering shares in 1970 at $16.50 apiece. Over the course of its existence, the stock has been split two-for-one 11 times. Therefore, if you’d bought 100 shares in 1970, you’d have more than 204,800 shares 50 years later. Your investment would have grown from $1,650 to more than $17 million.

Who owns the most Walmart stock?

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Apart from the members of the Walton family, top Walmart stockholders include Vanguard Group Inc., which owns more than 119.5 million or 4.31% of the overall pie, BlackRock Fund Advisors at 62 million, followed by SSgA Funds Management, at 60 million shares.

What is the highest price Walmart stock has ever been?

+

Walmart’s all-time high stock price is $152.79, achieved on November 30, 2020. That price is about 5% above the current share price.

About author

I have always thought of myself as a writer, but I began my career as a data operator with a large fintech firm. This position proved invaluable for learning how banks and other financial institutions operate. Daily correspondence with banking experts gave me insight into the systems and policies that power the economy. When I got the chance to translate my experience into words, I gladly joined the smart, enthusiastic Fortunly team.

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