Walmart Financial Analysis Essay - 1141 Words

Walmart Stores, Inc. (NYSE: WMT) branded as Walmart since 2008 and Walmart before then, is an American multinational retailer corporation that runs chains of large discount department stores and warehouse stores. It is the biggest private employer in the world with over 2 million employees, and is the largest retailer in the world. Walmart operates retail stores in various formats around the world and is committed to saving people money so they can live better and more comfortable. Walmart earns the trust of their customers every day by providing a broad assortment of quality merchandise and services at everyday low prices, while fostering a culture that rewards and embraces mutual respect, integrity, and diversity. The company is†¦show more content†¦They may have some good long term prospects that they can borrow against to meet their current obligations. Overall, liquidity is not a strength for Walmart due to both low quick ratio and current ratio. Asset management In 2011, Walmarts inventory turnover was 11.62 and the industry average was 10.4(stock-analysis). Its fixed asset turnover was 3.88 and the industry average was 3.56, and its total asset turnover was 2.34 and the industry average was 1.56(Stock-analysis). The values calculated for all three ratios mentioned all resulted in substantially different values in a positive way (Appendix B). Historically the values of each ratio have maintained relatively constant, which in this case is not a weakness. Asset management is a strength for Walmart, which ultimately means that they are maintaining their assets in the correct manner in order to have an efficient way of business. Debt Management In 2011, Walmarts debt to equity ratio was that of 72.75 while the industry average was 55 and it exceeded the range of comparability by a significant amount(Stock-analysis)(Appendix B). The debt to equity ratio indicates how much debt a company has for every dollar of shareholders equity. Walmarts value of 72.75 is high especially when considering the trend for the past three years. 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