Dividend Aristocrats Part 52: Wal-Mart Stores, Inc. (WMT)

Valuation and Final Thoughts

Wal-Mart is currently trading for an adjusted P/E ratio of just 13.7.

The company’s P/E ratio has averaged around 15.0 over the last decade.

In addition, Wal-Mart’s stock are trading near all time dividend yield highs.

Based on its historical dividend yield and price-to-earnings ratio, fair value for Wal-Mart shares is likely around $80.

The stock is currently trading for ~$65 per share, implying ~23% upside from current prices.

Wal-Mart Stores, Inc. (NYSE:WMT) ranks in the Top 10 using The 8 Rules of Dividend Investing due to the following metrics:

– Above average 3% dividend yield

– Conservative ~40% payout ratio

– Low price-to-earnings ratio of 13.7

– Market beating expected total returns 8% to 11% a year

– Low 10 year stock price standard deviation of 19.5%

– Low 10 year Beta of 0.5

Wal-Mart’s stock price declines over the last year combined with the higher-than-average possibility of a recession in 2016 make now an excellent time to buy into this industry leading corporation.

Disclosure: None