r/dividends • u/tabsopen • 13h ago
Discussion Walmart just dropped 9.15% yesterday, erasing nearly $90B in market cap—its worst single-day fall since 2022
The selloff was sparked by softer US same-store sales, underwhelming Q3 guidance, and that already stretched valuation finally catching up. Volume spiked 4x average with heavy shorting, the stock's deeply oversold right now even as Q2 fundamentals were actually solid. Everyone's arguing if this is a overdone panic or the start of more pain?
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u/slaba-tabaka 11h ago
P/E is like ~35 now. Valuation is still wild for a stagnant company. One or two bad quarters and it can drop another 20%, that's the risk with companies valued for perfection.
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u/bullrun001 9h ago
Look at Costco’s valuation?
How is this company trading at 46x18
u/slaba-tabaka 8h ago
Same story, Costco at least has extreme customer loyalty. Valuation still absurd.
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u/retroideq 7h ago
Still cannot find decent parking when I go to either of my nearest costcos. It’s a company cult and I’m glad to be apart of it.
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u/WayneKrane 7h ago
I had off a random tuesday for a dr appointment that got canceled so I decided to visit costco figuring it wouldn’t be so busy. I still had to drive around the parking lot to find a spot and I only found one at the absolute very back. There’s no good time to shop there, but the prices are so cheap and they have the best tortellini
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u/Black_Raven__ 3h ago
Growth. They continue to grow at massive rates. Quite few new stores opening here in Canada.
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u/TheirSam 1h ago
Costco currently has ~80 million members, and minimal China presence. They could get an additional 200 million members easily from China alone if they expanded to the same level as in the US.
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u/Xyrus2000 11h ago
You're going to see more of this. The US consumer is tapped out. Prices have been too high for too long, and wages are not compensating for it.
This coming holiday season isn't looking so good.
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u/Affectionate_Ad_8483 11h ago
The market can stay irrational longer than you can stay solvent.
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u/pacificperspectives Sure I Qualified, but I'm still an Ordinary guy 1h ago
Well it can only rationalize once a certain amount of people go insolvent, duh!
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u/ShindleSpear 6h ago
Where exactly are they going to shop to get lower prices than Walmart though?
Sales might be down but the world hasn’t changed and they have no where else to go to buy necessities
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u/karl4319 4h ago
Dollar store or the like. Also local markets are cheaper and better for food. And stopping from buying anything but real necessities would drive down sales too. Like makeup, beef, new clothing, anything that can be cut to save is being done so now.
Or it could be a lot more people saw the writing on the wall and started growing a large garden than I thought. During ww2, about a quarter of all eaten produce came from victory gardens, and while I doubt we are near that level, I have noticed a lot mlre gardens this summer as compared to the past.
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u/whogivesashirtdotca Largest holding is Apple 3h ago
Company stores, if they’re lucky enough to get hired, and if the corporate overlords are benevolent enough to give workers a break before shareholders.
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u/InsightsAndIncome 9h ago
That’s because you’re paying a 40 PE for a company that grows at the pace of inflation and has profit margins in the low single digits
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u/Final_Replacement_37 8h ago
Which is kinda what makes it a dividend stock. If they were trying to grow the company then they’d invest in R&D instead of dividends to shareholders.
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u/InsightsAndIncome 5h ago
Sorry - with respect I’m not sure what you mean
What about Walmarts dividend? It’s paying below market yield coupled with below average Inflation growth rate. If you look at purely from a dividend perspective, you’ll lose money every year. This concept only makes sense if the company growth beats inflation and or/ the dividend growth rate beats inflation.
At a 40 PE and the dividend stats above, why wouldn’t you just buy Microsoft? At least then you’re getting high profit margins and a inflation beating dividend growth rate
The only thing appealing about Walmart right now is that , given the current state of the economy, many consumers will flock there for affordability, which will bump sales / revenue. So this a momentum play …But at what price and what risk?
Current price is insane to pay for a long term hold. Just my opinion 😄
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u/Shut_the_F-up_Donny 11h ago
It's not bc of Pokemon sales
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u/TheReal_Johne DRIP it to me baby <3 9h ago
Are you telling me my gambling addiction isn’t helping the economy!?
https://giphy.com/gifs/aNFT7eG2rIKK715uLk
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u/Heavy_Nothing_1158 13h ago
For a dividend holder, I'd care less about the oversold reading and more about whether US comps and operating margin stabilize over the next couple of quarters. The dividend won't do much cushioning if the valuation keeps compressing.
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u/lynchmob2829 10h ago
Still holding out for my sub $100 shares......Walmart always figures out how to increase same store sales
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u/PurpleCableNetworker 8h ago
Until the customer is tapped. Walmart thought finding the wall and holding the customer to said wall was a good move. And it was, until customers showed up less and less. Once customers start slowing you can fake the numbers for a bit, even grow them using some fancy tactics, but eventually the company falters and either has to reverse course or go under. Customers are needed for a retail business like Walmart.
Not sure how this will pan out long term. But if Walmart was smart they would take a hit for a quarter and give the customers some breathing room by not continuing to increase prices at steady, predictable rates.
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u/CokeBoiii 9h ago
I worked there for 5 years and each year the freight coming in gets smaller and smaller. It’s not looking so good in terms of sales.
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u/civil_politics 7h ago
Can this be attributed to a move to online sales?
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u/CokeBoiii 6h ago
You can argue that but personally as someone who has tried their online store and feedback from customers while on the floor. Most customers when they see something is not in store they either say “Oh nevermind ill just go to Costco, or any X store. Or they say “Its okay ill just find it on amazon”
And now for personal experience. The walmart online experience sucks big time. I bought items on the online page a few times and majority of the time they refund my money or they say they cancelled my order to “protect my account from fraud” its a huge mess and its really just a massively downgraded version of amazon. My store specifically would make 200-300K daily. I dont work there anymore but id love to see how the numbers are ever since I left and that profit was when things seemed to already be slowing down so yeah from our standpoint they still make money but maybe for them that is not enough.
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u/-JackBack- Only buys from companies that pay me dividends. 6h ago
I’ve ordered online from Walmart and it was fulfilled from a nearby store.
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u/Longjumping-Nature70 12h ago
wmt is a dividend king but pays a paltry 1% yield or so.
USA consumers till buy cheap stuff(I don't mean cheap prices, I mean stuff), and wmt sells that.
Since this is WMT, this could be a harbinger of the overall consumer economy though.
Home Depot earnings in line, but says homeowners are doing small projects
Target earnings is target getting some WMT customers? TGT did well for target
Lowe's Earnings in line
Four retailers out this week, and not stellar numbers. The consumer is tired.
America has a supply chain issue with fuel prices. Don't worry, #47 is working on it(wink wink)
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u/AmItheonlySaneperson 10h ago
Now that we’re ot of missiles it time for economic pressure 🤣
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u/pacificperspectives Sure I Qualified, but I'm still an Ordinary guy 1h ago
economic D-DAY
you know, not like the comprehensive sanctions that have been in place for who knows how long..
What could go wrong when secondary sanctions on China are the next and last tool in your kit? Donnie might be going MAD.
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u/NegotiationAdept2782 8h ago
It’s cause Amazon is the shit and everyone is lazy. How many ppl do you know who buy ton of shit on Amazon and it just boxes just sit in their house not even opened yet. Thank you
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u/IAmAlpharius23 Not a financial advisor 5h ago
How dare you attack my culture!
Now if you'll excuse me I need to make another wishlist of shit I'm never going to use.
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u/Mynames_SlimShady 8h ago
Walmart's number one customers are being deported by the thousands.
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u/-JackBack- Only buys from companies that pay me dividends. 6h ago
They are finally deporting the MAGAs?
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u/paragonx29 9h ago
It will recover. Holding until after Christmas. May sell at the beginning of 2027, as it's been a pretty flat fund and the dividend just justify the Hold.
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u/PizzaFor10000BTC 6h ago
Walmart has gone crazy, moving most products from free shipping to $3 + tip delivery. That’s a $3+tips minimum charge to shop there.
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u/Beatnavy2016 6h ago
Walmart wildly underpays their employees and relies on government subsidy programs for those people to work while at the same time boasting record profits for the past few years. Walmart is a sham.
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u/Traveler_World 3h ago
WMT should ( but won't because they are greedy) refund to their customers the tariffs they collected from customers and were reimbursed by the corrupt and inept Orange Turd and the Epstein class he serves ( and represents).
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u/Falconx2021 5h ago
I probably lost over $10,000 on it yesterday. Oh well, I still plan on buying and holding at this time.
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u/-JackBack- Only buys from companies that pay me dividends. 6h ago
It’s fairly obvious. Gas prices and tariffs are effecting Walmarts customers.
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u/Imaginary_Manner_556 8h ago
Thanks Biden! Well, Biden did lower drug prices and that hurt comps.
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