WMTWalmart
Is the business good?
The checks split: nothing decisive, though earnings fully cash-backed (1.7×).
Operating profit is fully backed by cash.
Positive operating leverage, operating profit is growing faster than sales, so margins widen as the business scales.
Efficiency-driven, thin margins turned over fast (the retail model). ROE 23% = margin × turnover × leverage.
Unless marked, from derived.
Where this answer is blind. The F-score rewards improvement, so an already-elite company can score mid-pack.
How good a business is WMT?
Walmart earns 19% on the capital it employs against a 9.0% cost of capital, so the business is worth more the bigger it gets.
Return on invested capital · cost of capital 9.0% · 9.6 points above what the capital costs: growth creates value
- Operating margin
- 4.4%
Operating margin · Discount Stores median 4.5% · 12 months to Q2 2027
- Cash conversion
- 1.73×
Cash conversion · 1.72× a year ago · operating cash flow covers the operating profit after tax
- Share count, year on year
- −0.47%
Share count, year on year · flat: no meaningful dilution
| Year | Operating margin |
|---|---|
| FY2021 | 4.0% |
| FY2022 | 4.5% |
| FY2023 | 3.3% |
| FY2024 | 4.2% |
| FY2025 | 4.3% |
| FY2026 | 4.2% |
Details›
- Gross margin12 months to Q2 2027
- 25%
- Operating margin12 months to Q2 2027
- 4.4%
- Net margin12 months to Q2 2027
- 3.0%
- Free cash flow margin
- 1.8%
- Revenue, trailing twelve months
- $735.8B
- Free cash flow, trailing twelve months
- $13.5B
- Net income, trailing twelve months
- $22.1B
- Return on invested capitaloperating profit after tax ÷ debt + equity − cash
- 19%
Margins, capital and share counts from the statements as filed with the SEC; cash conversion is operating cash flow over operating profit after tax.
Consumer Defensive
Ranks #58 of 130 by RyuScore