Walmart is being pumped like a new dot-com company, but its high P/E will need to be matched by revenue growth, which investors will soon realize. x.comÂ
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Stock & Bond Market Commentary
Walmart's 43.28x earnings multiple makes the stock impossible to buy for a long time. Its historical median is 31.13x, and even at 30x it would not be attractive. x.comÂ
Walmart is too expensive at 47 times earnings and has further to fall over the next few months. x.comÂ
Walmart may be setting up for a big bounce, with its pullback matching the pattern of its last two bottoms. The stock is down about 25% from its all-time high, as it was before both prior bottoms, which also showed RSI divergence. Its forward P/E has fallen from near 40 earlier this year to a more respectable 31, and it is holding just above the psychological $100 level near a prior breakout area. x.comÂ
Walmart's 41x P/E looks hard to justify when gas prices are going through the roof. x.comÂ
Walmart does not deserve 40x forward earnings, especially with comparable sales growth at its slowest in over six years. Per @negligible_cap, the stock fell 6% on decelerating comps and could eventually have a Target- or Nike-style moment as investors realize it can't hold that multiple forever. x.com x.comÂ
Walmart has the strongest fundamentals in retail, with $725B+ of revenue, exploding e-commerce and market-share gains while rivals bleed. It is a defensive cash-printing machine in a shaky economy, and analysts rate it a moderate buy with $140+ targets. x.comÂ
Walmart is a great company at a terrible price, trading near 38 times forward earnings while growth slows. Revenue and EPS beat, yet US comparable sales growth slowed to 2.6%, the weakest in six years, and the stock fell. Even after another 10% drop, it is not worth buying. x.comÂ
Walmart's valuation is too high for a grocery and household retailer. At about 36 times next year's earnings, it exceeds its five-year norm of 25 and the roughly 20 times this business should command; Target trades near 16 times. Stay away from Walmart here. x.comÂ
Walmart looks like a safe-haven play after falling about 25% from its highs, with UBS expecting record Q2 sales when it reports next week. The chart is forming an inverse head-and-shoulders pattern with a 12-point target from the neckline. x.comÂ
Walmart is arguably more exposed than its safe-haven history suggests, because its edge rests on competing with Amazon, and doing that clearly will require far more capital. Historically it has been a place to hide, but that does not mean owning or shorting it; it is simply a stock to avoid. x.com x.comÂ