Walmart Price To Earning vs. Return On Equity
| WMT Stock | EUR 87.00 0.12 0.14% |
For Walmart profitability analysis, we use financial ratios and fundamental drivers that measure the ability of Walmart to generate income relative to revenue, assets, operating costs, and current equity. These fundamental indicators attest to how well Walmart utilizes its assets to generate profit and value for its shareholders. The profitability module also shows relationships between Walmart's most relevant fundamental drivers. It provides multiple suggestions of what could affect the performance of Walmart over time as well as its relative position and ranking within its peers.
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Walmart Return On Equity vs. Price To Earning Fundamental Analysis
Comparative valuation techniques use various fundamental indicators to help in determining Walmart's current stock value. Our valuation model uses many indicators to compare Walmart value to that of its competitors to determine the firm's financial worth. Walmart is rated first in price to earning category among its peers. It is rated first in return on equity category among its peers . The ratio of Price To Earning to Return On Equity for Walmart is about 245.56 . The reason why the comparable model can be used in almost all circumstances is due to the vast number of multiples that can be utilized, such as the price-to-earnings (P/E), price-to-book (P/B), price-to-sales (P/S), price-to-cash flow (P/CF), and many others. The P/E ratio is the most commonly used of these ratios because it focuses on the Walmart's earnings, one of the primary drivers of an investment's value.Walmart Return On Equity vs. Price To Earning
Price to Earnings ratio is typically used for current valuation of a company and is one of the most popular ratios that investors monitor daily. Holding a low PE stock is less risky because when a company's profitability falls, it is likely that earnings will also go down as well. In other words, if you start from a lower position, your downside risk is limited. There are also some investors who believe that low Price to Earnings ratio reflects the low pricing because a given company is in trouble. On the other hand, a higher PE ratio means that investors are paying more for each unit of profit.
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| = | 31.53 X |
Generally speaking, the Price to Earnings ratio gives investors an idea of what the market is willing to pay for the company's current earnings.
Return on Equity or ROE tells company stockholders how effectually their money is being utilized or reinvested. It is a useful ratio when analyzing company profitability or the management effectiveness given the capital invested by the shareholders. ROE shows how efficiently a company utilizes investments to generate income.
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| = | 0.13 |
For most industries, Return on Equity between 10% and 30% are considered desirable to provide dividends to owners and have funds for the future growth of the company. Investors should be very careful using ROE as the only efficiency indicator because ROE can be high if a company is heavily leveraged.
Walmart Return On Equity Comparison
Walmart is currently under evaluation in return on equity category among its peers.
Walmart Profitability Projections
The most important aspect of a successful company is its ability to generate a profit. For investors in Walmart, profitability is also one of the essential criteria for including it into their portfolios because, without profit, Walmart will eventually generate negative long term returns. The profitability progress is the general direction of Walmart's change in net profit over the period of time. It can combine multiple indicators of Walmart, where stable trends show no significant progress. An accelerating trend is seen as positive, while a decreasing one is unfavorable. A rising trend means that profits are rising, and operational efficiency may be rising as well. A decreasing trend is a sign of poor performance and may indicate upcoming losses.
Walmart Inc. engages in the operation of retail, wholesale, and other units worldwide. Walmart Inc. was founded in 1945 and is based in Bentonville, Arkansas. WALMART DL operates under Discount Stores classification in Germany and is traded on Frankfurt Stock Exchange. It employs 2300000 people.
Walmart Profitability Driver Comparison
Profitability drivers are factors that can directly affect your investment outlook on Walmart. Investors often realize that things won't turn out the way they predict. There are maybe way too many unforeseen events and contingencies during the holding period of Walmart position where the market behavior may be hard to predict, tax policy changes, gold or oil price hikes, calamities change, and many others. The question is, are you prepared for these unexpected events? Although some of these situations are obviously beyond your control, you can still follow the important profit indicators to know where you should focus on when things like this occur. Below are some of the Walmart's important profitability drivers and their relationship over time.
Use Walmart in pair-trading
One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if Walmart position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Walmart will appreciate offsetting losses from the drop in the long position's value.Walmart Pair Trading
Walmart Pair Trading Analysis
The ability to find closely correlated positions to Walmart could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace Walmart when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back Walmart - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling Walmart to buy it.
The correlation of Walmart is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as Walmart moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Walmart moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for Walmart can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.Use Investing Themes to Complement your Walmart position
In addition to having Walmart in your portfolios, you can quickly add positions using our predefined set of ideas and optimize them against your very unique investing style. A single investing idea is a collection of funds, stocks, ETFs, or cryptocurrencies that are programmatically selected from a pull of investment themes. After you determine your investment opportunity, you can then find an optimal portfolio that will maximize potential returns on the chosen idea or minimize its exposure to market volatility.Did You Try This Idea?
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Companies involved in mining, production, and distribution of silver and silver goods. The Silver theme has 41 constituents at this time.
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Additional Information and Resources on Investing in Walmart Stock
When determining whether Walmart is a good investment, qualitative aspects like company management, corporate governance, and ethical practices play a significant role. A comparison with peer companies also provides context and helps to understand if Walmart Stock is undervalued or overvalued. This multi-faceted approach, blending both quantitative and qualitative analysis, forms a solid foundation for making an informed investment decision about Walmart Stock. Highlighted below are key reports to facilitate an investment decision about Walmart Stock:Check out Your Current Watchlist. For more detail on how to invest in Walmart Stock please use our How to Invest in Walmart guide.You can also try the Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
To fully project Walmart's future profitability, investors should examine all historical financial statements. These statements provide investors with a comprehensive snapshot of the financial position of Walmart at a specified time, usually calculated after every quarter, six months, or one year. Three primary documents fall into the category of financial statements. These documents include Walmart's income statement, its balance sheet, and the statement of cash flows.