Caution on Walmart's High Valuation Revealed in Earnings Multiples

3 days ago

Host

"Okay, here's what I am worried about. 40 times earnings, guys. It's Walmart. Yeah, I know it's going to grow a lot, but it's 40 times earnings. Look at its profit margin. 10-year 2.45%, 5-year 2.38%, one year 3.26%. Guys, they make pennies on every dollar they sell. It's not a high margin business. I would rather wait until the stock is a lot lower to buy it at the right price."

The speaker expresses concern over Walmart's current valuation, emphasizing its 40x earnings and low profit margins despite growth prospects. He advises investors to be patient and wait for a lower entry price rather than overpaying for a fundamentally basic yet undervalued retail giant.

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