Home » Quarter » 2011 4Q, Services, USA, Wal-Mart Stores » Wal-Mart Stores 2011 4Q financial analysis

Wal-Mart Stores 2011 4Q financial analysis

Companies revenue shows slight increase. Compared 2011 4Q with 2010 4Q increased by 6% from 116 bn.$ to 123 bn.$ Annual revenue increased at same rate +6%. Main revenue increase driver was ~15% increased international sales due to investments in abroad. Sales in US increased only by 2%. Net Income before depreciation grew by 8% from 7,0 bn.$ to 7,6 bn.$ at Q4 annually by 6% from 23 bn.$ to 24,3 bn.$. In general sesults are slightly positive.

Equity level as in 4Q 2010 Equity has increased a bit to 37% and is average. For safe zone could be closer to 50%. ROE as always at 4Q increases due to seasonality. Results are slightly better then last years 31% compared to 29%. ROA is ~10% about the same level as last year.

The most worried thing is that liquidity ratio is below 1 and is stably around 0,9. But such indicator is likely for supermarket business, because they are driven by deffer payment to its suppliers as companies clients are final users and pay the same moment as he purchase his products. Only thing that companies need is to sell its good faster then deffer payment time. Companies inventory level is ~41 bn.$ turnover ~30 days. Account receivables are minimal. Account payable ~37 bn.$ turnover ~40 days. Both in line.

Larger investments into long term asset are fixed at Q4 in total ~5 bn.$ ant Q2 there was ~10 bn.$ investments into long therm asset. Equity change is -13 bn.$ and is a bit less then 1/2 of companies generated Net Income before depreciation which is acceptable. Financial liabilities as always decreased at end of January due to seasonality while steadily increasing at other quarters. In general companies balance structure is average.

 

Share value:

Common Stocks 4,0 bn.$ 3,424 bn. 1,2 $
+ Retained earnings 68,7 bn.$ + 20,1 $ 21,3 $
+ 1 year Net income before Depreciation 24,3 bn.$ + 7,1 $ 28,4 $

 

Companies share basic value is ~21$.  Current market price is 61$ which shows that market is paying 40$ more or 5,6 years of Net income before Depreciation earnings. Share profitability (share market price/Net income before Depreciation) is 12%.

Company at the moment pays 1,60$/share annual dividends (0,40$/quarter) before tax or 2,6% investment yield.

Analysis source: Wal-Mart 2011 4Q 10-K financial statements

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