Quiet Compounder, Strong Quarter
Walmart is, in the short term, one of those “boring” companies, not much volatility, a relatively small dividend, and nowhere near as flashy as NVIDIA or as futuristic as Tesla.
But over the long term, they simply deliver. A 6x return over the past decade is extraordinary, roughly a 19% annual return, and that’s without even factoring in dividends.
Today, the company delivered again. Quarterly results were solid, with revenue up 5.6% YoY and eCommerce continuing to surge. They also announced a 5% dividend increase. For the new CEO, John Furner, it’s hard to imagine a better start. The stock is up +1,8% currently.
The only grain of salt is the cautious guidance for the coming quarters, and the fact that the stock isn’t cheap anymore. A P/E ratio around 45 is elevated, but right now investors seem willing to pay a premium multiple for a premium-quality business.
Are you invested in $WMT? I’m not, mainly because it’s rarely ever cheap.
