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Walmart Stock: Current Valuation and Analysts’ Ratings

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Valuation summary

Walmart (WMT) is currently trading at a forward PE multiple of 17.4x, which is higher than Target’s (TGT) current PE multiple of 14.3x. Walmart’s valuation multiple is also higher than the S& 500 Index (SPY), which was trading at a forward PE multiple of 16.7x as of July 5. Walmart stock is trading 5% higher than its four-year historical average multiple of 16.6x.

Analysts expect Walmart’s top line to see a 2% growth in fiscal 2018, while its EPS is projected to grow a little more than 9%. Walmart stock offers a dividend yield of 2.5%. In comparison, Target’s lower valuation and higher dividend yield (3.5%) and Costco’s (COST) impressive sales and earnings growth rate makes them more attractive investment options in the retail space.

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Ratings and target price

Of the 31 analysts covering Walmart stock, 18 of them are recommending a “hold,” and 13 are recommending a “buy.” They have given the stock a target price of $95.12, which reflects an upside of 12.5% based on its closing price of $84.57 as of July 5.

Most of the analysts covering Target are recommending a “hold” for the stock. But analysts remain optimistic about the prospects for Costco and have rated it a “buy.”

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