Use the valueline's Report for Walmart in posted under your assignment folder and use the Dividend Discount Model The Residual Discount Model, and Price-Earnings Ratio Price Ratio Analysis) (see chapter 6) to estimate the value of Walmart stock. Note: You can fook up the following information in Valueline's report and analysts, forecasts as inputs for your valuation models: Risk Free Rate (R) to year-T-bord rate 1.45% Market Return (Re; use the average 10 year S&P Market Index Return, adjusted for indiation 11.5 For the Dividend Discount Model, you should be able to obtain or calculate the following information from the Valueline Report for Walmart Inc. Use CAPM model to calculate discount rate required rate-LK-risk-free rabeta (marker return-risk free rate) You can look up the firm market risk (Beta) of Walmart in the report (shown at the Top lett The dividend (DO): Use dividend per share (DPS in 2020 as the base year. You can use Dividend Per Share in 2021 in the bold column) as the dividend amount next perlod next year (on) The amount DPS (or other values reported in the 2021 column of the report is the forecasted amount at the end of 2021 Long term foretasted Annual Growth Rate ry. Use can look up the Annual Rates Box (show on the middle left in the report and use the estimated next five years as the long-term annual growth rate for your dividend discount models, and you can compute the sustainable growth rate calculated from payout ratio and Return on Equity (ROE) - 2020 as the based yet (Growth Ratu ROE*Retention ratio=ROF (1-Payout Ratio=ROE* 11-OPS/EPS) Note: Payout Patio-Dividend Per Share(DPS Earnings Per Share EPS). You should use the 2020 information as the base year to estimate the growth rate. For the Residual income Modet You can look upluse information provided in the report to be used as inputs for your model Book value per share (Bo): Use the 2020 book value per share as Bo, and use the 2021 value of book value per share as B. Similarly, you can look up EPS tearnings per shares Again, use the 2020 value as the base year and the 2021 value as the forecasted next year (EPS1) value For the Price Earnings Ratio: At the top of the report, you can find the DVE ratio, you can use that information as the base Ple ratio. WALMART INC. NYSE a 147.29. 25.8 (1.19 1.5% VALUE EDE 2005 2004 2005 TIMEUNESS 1 SAFETY 1 TEONCAL 3 LES Month Tapet Price Range Low to RE 2595LECTIONS AR Pro TOT RETURN Institutions Deco 0 E004 2005 2004 2003 20020123 2015 2014 2015 2016 2017 3700 THIS 10 le TEN HEERE 47 141 aaaaalse HI ROEDERDELE TELE TO 25 21 22 23 24 w CAPITAL STRUCTURES OF 1012 CIMO DOS TODOS BY 2020 BUNS LT Debt 250 als MO 100 ww HAMIS No De Bouton Pleso Commons 54332902 SA 2018 ER MARKET CAR HIT CURRENT POSITION 2010 20100100 2 BUSINESS Revetlos LIFO DES200 22 102 103 TRE the same AP 7000 Send Us De e 52.COM Durat 178 Walmart doing an admirable job mart, and management thinkos all the will ANNUAL RATES Fast Past Ergrowing its business. The world larg happen at a long time from now. 5232 out tutaiur recorded 6.45 in The company appears to have recent domestie samese sales during the finally surrendered one market share in IN ED third 1 quarter driven by the food.com.br categories Management admitted health & SR Customers and of this can be Lor) Ottnan 24 Orwy un ded det the QUARTERLY SALESIA shopping trip as evidenced by time that these the transaction 201711754292055 1020 e Transactions showed improvement her mere from a permarkets in , shoppers appear to be buying 2001-20025 100 101 More hours were extended, tead crowds at Walmart The tom likely to the current 2015 Se working improve t-stock 2001 TOM There has been a return to stock up ve which BAINING PERSEAS bamid the winter Cand aus Weid bipal difficult Walmarte somewhat dif Ao 30 23 Ott Jan should continue to be a tailwind. Total ferentiated from rival Amazon Prime 2017 1 2010 1.14 12 595 While curlaide the membership service leverage the 30 121118 12 should pickup activity le pot sore how to provident delivery 2009 152 in a permanent parties from perders. The man and 1.551 Walmart.com home delivery is futures and to the platform QUARTER I DVEROS MD. indar 31 X Sep. Duc and it rain to if the budding videre til enables discounts on rice will resonate 2017 20 more excited about plans for driving room to run. This relatively safe equity ate with shoppers Were Timely Walmart shares have further i tracks to deliver orders from were to be held turm nisk-adjusted 54 215 designated pickup locatie. De may price appreciate potential also end up being a game changer for Walki January 22, 201 mer will 13 core ale ve will remain 2001 10 Bering 51 51 51 SO 51 54 ng w To be WALMART INC. NYSE-WT (Hodine: 153) PERATO 1.19 PM 1.5% 2 1190 share 050 TE TEE DER MET 1 PE DIVD VALUE PRICE LINE TIMELINESS 1 Puined 7020 High: 57.5 56.3 60.0 77,6 81.4 88.1 91.0 75.2 100.1 110.0 125.4 153.7 Low. 46.31 47.8 48.3 572 67.7 72.3 56.3 60.2 65.3 81.8 Target Price Range 91.6 1020 SAFETY 1 Raised 2/1572 LEGENDS 2023 2024 2025 160 T C Flowsh TECHNICAL 3 Lowered 12121 Relative Price Singh 320 Options: Yes BETA 55 11.00 - Man Shased randes maison -200 18-Month Target Price Range 160 Low-High Midpoint (% to Mid) -120 100 $127-$187 $157 (59) T, -80 2023-25 PROJECTIONS 460 Anni Total yang ou lewe Price Gain Return -40 High 205 (-40%) 10% LOW 170 -15% 5% Institutional Decisions % TOT. RETURN 12/20 102020 202120 2012 Thes VLANT Percent 12 STOCK INDEX -18 to Buy 957 1114 8 1 y. 23.3 18.8 to 1017 075 4 yr 55.0 299 Hid/X0854077 836791 838223 5 yr 163.6 81.5 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 VALUE LINE PUB. LLC 23-25 68.02 75.79 84.40 95.34 103.34 107.82 119.9130.76 141.57 147.32 150.45 152.48 159.41 169.40 178.74 185.02 106.00201.80 Sales persh A 232.70 3.47 3.78 427 4.83 3.16 5.04 6.92 7.60 7.92 793 7.64 7.72 8.07 8.73 8.83 9.60 8.95 Cash Flow per sh 12.00 241 263 2.92 3.16 3.42 3.68 4.07 4.45 5.02 5.11 5.07 457 442 491 4.93 5.60 5.85 Earnings per sh AB 7.50 52 .00 67 88 96 1.00 121 1.40 1.50 1.80 1.92 1.00 2.00 204 200 2.12 2.16 220 Dvds Decl'd per sh 2.00 1167 1277 1491 16.26 16.00 18.00 1949 20.86 23.04 23,50 2522 25.47 2552 26.38 25.10 28.37 30.25 31.60 Book Value per sh 1.00 4234041680-131039730302503786.035100 4180 33140 233.0 228.031102030402052028760 28320 2300 2765. Common Shs Outsta 23000 220 163) 13 124 1313 140 154 1313 160 223 Bold are Avg Ann IPE Ratio 250 120 97 86 79 97 .90 83 .78 .84 81 78 85 94 1.01 1.10 Valur Line Relative PE Ratio 1.40 0% 12% 14% 1.9% 1.7% 2.1% 23% 2.7% 23% 2.5% 25% 2.8% 2% 28% 23% 1.0% son Avg Ann'l Divd Yield 1.5% CAPITAL STRUCTURE as of 10/31/20 421849 446950 409162 476294 485651 482130485873 500343 514406 523964 554700568000 Sales (Smill) A 605000 Total Debt $50771 mil. Duo in 5 yrs $20220 mill. 25,3% 25.0% 24.9% 24.8% 24.8% 25.1% 25.0% 25.4% 25.124.7% 245% 2.5% Gross Margin 25.0% LT Debt $45599 mil. LT Interest $2150 mil 7.9% 7.7% Incl. 84750 mill. in finance les obligations 7.7% 7.7% 78% 7.0% 6.7% 6.7% 6.3% 62% 6.3% 6.45 Operating Margin 6.5% (Total interest Coverage: 11.3x) (36% of Cap') 89701013010773 1094211453 1152811896 11718 11361 11501 11670 11700 Number of Stores 12000 1492115623 1690 1672 16425 1460413452 13283 14460 14081 1595016250 Net Profit (Smil) 19615 Leases, Uncapitalized Annual rentals $1725 mil. 34.0% 33.4% 31.0% 32.2319% 30.3% 30.8% 31.4% 24.5%24.225.0% 25.0% Income Tax Rate 25,0% 3.59 3.6% 3.5% 34% 20% 28% 295 Net Profit Margin 228 No Defined Benefit Ponsion Plan 06591 07325011678681600999404360 09239616857 015580 015984 014660 16610 Working CapiSmill) Pld Stock None 09200 438424707941417 4455943082 44030 42018 36825 50208 48021 45000 45000 Long-Term Debt (Smil) 40000 Common Stock 2,829.285,926 shs. 685427131576343 76255 81394 805467779877869 7249674669 85650 87300 Sht. Equity (Smill) 99400 as of 11/30/20 14.1% 14.0% 15.3% 14.7% 14.0% 12.0% 12.1% 12.1% 12.7% 12.5% 120% 1205 Return on Total Cap' 15.5% 21.8% 218%223%21.9%202% 18.2% 17.3% 17.1% MARKET CAP: 5417 billion (Large Cap) 19.9% 18.9918.5% 18.5% Return on Shr. Equity 22.0% 15.3% 14.7% 15.2% 13.9% 126% 10.4% 9.3% 9.2% 11.5% 10.8% 11.5% 11.55 Retained to Com Eq 13.5% CURRENT POSITION 2018 2019 10/31/20 (SMILL 33% 32% 37% 48% 42% 389 Al Div'ds to Net Prof 30% Cash Access 7793 QARE 14995 4 DIBINAL . ann Use the valueline's Report for Walmart in posted under your assignment folder and use the Dividend Discount Model The Residual Discount Model, and Price-Earnings Ratio Price Ratio Analysis) (see chapter 6) to estimate the value of Walmart stock. Note: You can fook up the following information in Valueline's report and analysts, forecasts as inputs for your valuation models: Risk Free Rate (R) to year-T-bord rate 1.45% Market Return (Re; use the average 10 year S&P Market Index Return, adjusted for indiation 11.5 For the Dividend Discount Model, you should be able to obtain or calculate the following information from the Valueline Report for Walmart Inc. Use CAPM model to calculate discount rate required rate-LK-risk-free rabeta (marker return-risk free rate) You can look up the firm market risk (Beta) of Walmart in the report (shown at the Top lett The dividend (DO): Use dividend per share (DPS in 2020 as the base year. You can use Dividend Per Share in 2021 in the bold column) as the dividend amount next perlod next year (on) The amount DPS (or other values reported in the 2021 column of the report is the forecasted amount at the end of 2021 Long term foretasted Annual Growth Rate ry. Use can look up the Annual Rates Box (show on the middle left in the report and use the estimated next five years as the long-term annual growth rate for your dividend discount models, and you can compute the sustainable growth rate calculated from payout ratio and Return on Equity (ROE) - 2020 as the based yet (Growth Ratu ROE*Retention ratio=ROF (1-Payout Ratio=ROE* 11-OPS/EPS) Note: Payout Patio-Dividend Per Share(DPS Earnings Per Share EPS). You should use the 2020 information as the base year to estimate the growth rate. For the Residual income Modet You can look upluse information provided in the report to be used as inputs for your model Book value per share (Bo): Use the 2020 book value per share as Bo, and use the 2021 value of book value per share as B. Similarly, you can look up EPS tearnings per shares Again, use the 2020 value as the base year and the 2021 value as the forecasted next year (EPS1) value For the Price Earnings Ratio: At the top of the report, you can find the DVE ratio, you can use that information as the base Ple ratio. WALMART INC. NYSE a 147.29. 25.8 (1.19 1.5% VALUE EDE 2005 2004 2005 TIMEUNESS 1 SAFETY 1 TEONCAL 3 LES Month Tapet Price Range Low to RE 2595LECTIONS AR Pro TOT RETURN Institutions Deco 0 E004 2005 2004 2003 20020123 2015 2014 2015 2016 2017 3700 THIS 10 le TEN HEERE 47 141 aaaaalse HI ROEDERDELE TELE TO 25 21 22 23 24 w CAPITAL STRUCTURES OF 1012 CIMO DOS TODOS BY 2020 BUNS LT Debt 250 als MO 100 ww HAMIS No De Bouton Pleso Commons 54332902 SA 2018 ER MARKET CAR HIT CURRENT POSITION 2010 20100100 2 BUSINESS Revetlos LIFO DES200 22 102 103 TRE the same AP 7000 Send Us De e 52.COM Durat 178 Walmart doing an admirable job mart, and management thinkos all the will ANNUAL RATES Fast Past Ergrowing its business. The world larg happen at a long time from now. 5232 out tutaiur recorded 6.45 in The company appears to have recent domestie samese sales during the finally surrendered one market share in IN ED third 1 quarter driven by the food.com.br categories Management admitted health & SR Customers and of this can be Lor) Ottnan 24 Orwy un ded det the QUARTERLY SALESIA shopping trip as evidenced by time that these the transaction 201711754292055 1020 e Transactions showed improvement her mere from a permarkets in , shoppers appear to be buying 2001-20025 100 101 More hours were extended, tead crowds at Walmart The tom likely to the current 2015 Se working improve t-stock 2001 TOM There has been a return to stock up ve which BAINING PERSEAS bamid the winter Cand aus Weid bipal difficult Walmarte somewhat dif Ao 30 23 Ott Jan should continue to be a tailwind. Total ferentiated from rival Amazon Prime 2017 1 2010 1.14 12 595 While curlaide the membership service leverage the 30 121118 12 should pickup activity le pot sore how to provident delivery 2009 152 in a permanent parties from perders. The man and 1.551 Walmart.com home delivery is futures and to the platform QUARTER I DVEROS MD. indar 31 X Sep. Duc and it rain to if the budding videre til enables discounts on rice will resonate 2017 20 more excited about plans for driving room to run. This relatively safe equity ate with shoppers Were Timely Walmart shares have further i tracks to deliver orders from were to be held turm nisk-adjusted 54 215 designated pickup locatie. De may price appreciate potential also end up being a game changer for Walki January 22, 201 mer will 13 core ale ve will remain 2001 10 Bering 51 51 51 SO 51 54 ng w To be WALMART INC. NYSE-WT (Hodine: 153) PERATO 1.19 PM 1.5% 2 1190 share 050 TE TEE DER MET 1 PE DIVD VALUE PRICE LINE TIMELINESS 1 Puined 7020 High: 57.5 56.3 60.0 77,6 81.4 88.1 91.0 75.2 100.1 110.0 125.4 153.7 Low. 46.31 47.8 48.3 572 67.7 72.3 56.3 60.2 65.3 81.8 Target Price Range 91.6 1020 SAFETY 1 Raised 2/1572 LEGENDS 2023 2024 2025 160 T C Flowsh TECHNICAL 3 Lowered 12121 Relative Price Singh 320 Options: Yes BETA 55 11.00 - Man Shased randes maison -200 18-Month Target Price Range 160 Low-High Midpoint (% to Mid) -120 100 $127-$187 $157 (59) T, -80 2023-25 PROJECTIONS 460 Anni Total yang ou lewe Price Gain Return -40 High 205 (-40%) 10% LOW 170 -15% 5% Institutional Decisions % TOT. RETURN 12/20 102020 202120 2012 Thes VLANT Percent 12 STOCK INDEX -18 to Buy 957 1114 8 1 y. 23.3 18.8 to 1017 075 4 yr 55.0 299 Hid/X0854077 836791 838223 5 yr 163.6 81.5 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 VALUE LINE PUB. LLC 23-25 68.02 75.79 84.40 95.34 103.34 107.82 119.9130.76 141.57 147.32 150.45 152.48 159.41 169.40 178.74 185.02 106.00201.80 Sales persh A 232.70 3.47 3.78 427 4.83 3.16 5.04 6.92 7.60 7.92 793 7.64 7.72 8.07 8.73 8.83 9.60 8.95 Cash Flow per sh 12.00 241 263 2.92 3.16 3.42 3.68 4.07 4.45 5.02 5.11 5.07 457 442 491 4.93 5.60 5.85 Earnings per sh AB 7.50 52 .00 67 88 96 1.00 121 1.40 1.50 1.80 1.92 1.00 2.00 204 200 2.12 2.16 220 Dvds Decl'd per sh 2.00 1167 1277 1491 16.26 16.00 18.00 1949 20.86 23.04 23,50 2522 25.47 2552 26.38 25.10 28.37 30.25 31.60 Book Value per sh 1.00 4234041680-131039730302503786.035100 4180 33140 233.0 228.031102030402052028760 28320 2300 2765. Common Shs Outsta 23000 220 163) 13 124 1313 140 154 1313 160 223 Bold are Avg Ann IPE Ratio 250 120 97 86 79 97 .90 83 .78 .84 81 78 85 94 1.01 1.10 Valur Line Relative PE Ratio 1.40 0% 12% 14% 1.9% 1.7% 2.1% 23% 2.7% 23% 2.5% 25% 2.8% 2% 28% 23% 1.0% son Avg Ann'l Divd Yield 1.5% CAPITAL STRUCTURE as of 10/31/20 421849 446950 409162 476294 485651 482130485873 500343 514406 523964 554700568000 Sales (Smill) A 605000 Total Debt $50771 mil. Duo in 5 yrs $20220 mill. 25,3% 25.0% 24.9% 24.8% 24.8% 25.1% 25.0% 25.4% 25.124.7% 245% 2.5% Gross Margin 25.0% LT Debt $45599 mil. LT Interest $2150 mil 7.9% 7.7% Incl. 84750 mill. in finance les obligations 7.7% 7.7% 78% 7.0% 6.7% 6.7% 6.3% 62% 6.3% 6.45 Operating Margin 6.5% (Total interest Coverage: 11.3x) (36% of Cap') 89701013010773 1094211453 1152811896 11718 11361 11501 11670 11700 Number of Stores 12000 1492115623 1690 1672 16425 1460413452 13283 14460 14081 1595016250 Net Profit (Smil) 19615 Leases, Uncapitalized Annual rentals $1725 mil. 34.0% 33.4% 31.0% 32.2319% 30.3% 30.8% 31.4% 24.5%24.225.0% 25.0% Income Tax Rate 25,0% 3.59 3.6% 3.5% 34% 20% 28% 295 Net Profit Margin 228 No Defined Benefit Ponsion Plan 06591 07325011678681600999404360 09239616857 015580 015984 014660 16610 Working CapiSmill) Pld Stock None 09200 438424707941417 4455943082 44030 42018 36825 50208 48021 45000 45000 Long-Term Debt (Smil) 40000 Common Stock 2,829.285,926 shs. 685427131576343 76255 81394 805467779877869 7249674669 85650 87300 Sht. Equity (Smill) 99400 as of 11/30/20 14.1% 14.0% 15.3% 14.7% 14.0% 12.0% 12.1% 12.1% 12.7% 12.5% 120% 1205 Return on Total Cap' 15.5% 21.8% 218%223%21.9%202% 18.2% 17.3% 17.1% MARKET CAP: 5417 billion (Large Cap) 19.9% 18.9918.5% 18.5% Return on Shr. Equity 22.0% 15.3% 14.7% 15.2% 13.9% 126% 10.4% 9.3% 9.2% 11.5% 10.8% 11.5% 11.55 Retained to Com Eq 13.5% CURRENT POSITION 2018 2019 10/31/20 (SMILL 33% 32% 37% 48% 42% 389 Al Div'ds to Net Prof 30% Cash Access 7793 QARE 14995 4 DIBINAL . ann
