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If you’re trying to learn how to buy Walmart stock, you probably know that only truly global retailer that dominates both the brick-and-mortar and online space is none other than Walmart (NYSE:WMT).
Publicly traded since 1970, Walmart stock has long held a prominent position as a solid, long-term blue-chip investment in millions of investors’ portfolios. Today the company has annual revenues in excess of $500 billion and employs 2.3 million associates around the globe, via Walmart U.S., Walmart International and Sam’s Club. If you invested $10,000 in WMT stock back in 1998 and reinvested dividends, that investment would be worth $45,015.27 today. Just in the last year alone, a $10,000 investment would have gained 23.27%, to $12,295, beating the S&P 500 in what was a very good year.
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Walmart at a glance
Walmart is the leading value retailer (indeed, the largest retailer, period) and today has over 270 million customers. The brand is known for its 11,700 big-box stores that offer everything from clothing, household goods, and groceries to electronics, sporting goods and toys to tires and hardware. Recently, the company made a major push toward integrating e-commerce with brick-and-mortar operations, and today its websites contribute significantly to top-line growth.
You can easily make purchases online, pick up items at the store or enjoy free two-day shipping and enjoy the convenience of in-store returns if necessary. Walmart employs a mind-boggling 2.3 million associates and invests heavily in compensation to strengthen loyalty and the customer service experience.
History of Walmart stock
Walmart debuted on the New York Stock Exchange in 1970, declared its first dividend in 1974, and has increased the dividend annually ever since. If you invested $10,000 in WMT stock back in 1998 and reinvested dividends each time, that investment would now be worth $45,015.27 (as of 8/31/18) – a total return of roughly 350% and an average annual return of 7.81%. Just in the last year alone, a $10,000 investment would have gained 23.27%, to $12,295, beating the S&P 500.
Over the last 12 months (ending 8/31/18), WMT has traded in a range between $77.50 and $109.98.
Quick snapshot of WMT
Why purchase Walmart stock?
Pros of purchasing Walmart stock:
- Walmart’s brand name is synonymous with value and with $500 billion in annual revenue, the company is incredibly stable.
- Walmart is twice as large as Amazon.
- The dividend is remarkably reliable, having increased annually every year since 1974.
- In the event of an economic downturn, Walmart is well-positioned as the on-the-ground, value retailer of choice for price-conscious shoppers around the globe.
- Walmart is leveraging its unmatched on-the-ground retail presence to augment a superior online shopping experience
Cons of purchasing Walmart stock:
- The battle with Amazon for online retail supremacy has yet to play out.
- As with any retailer, Walmart would be impacted to some extent by an economic downturn. This could lead to a pullback in consumer spending, here in the U.S. and, potentially, around the globe.
- A movement in the U.S. toward significantly higher minimum wage could also impact margins and bottom-line growth.
How to purchase WMT
As a member of the Dow 30, Walmart is considered blue-chip and its stock is available for purchase through all major brokerage firms that trade in securities. Some basic ideas on how to acquire the stock are as follows:
- Size your investment.
Determine the total amount of money you wish to allocate to Walmart’s stock and then figure out the number of shares by dividing the total amount by the current share price.
- Select a broker.
Most brokers that allow for individual trading of stocks will be able to purchase Walmart’s stock. You can review brokers based on costs, service, and tools they offer.
- Purchase shares of Walmart.
When you’re ready to execute your order, go online to your brokerage of choice and purchase the shares through a purchase order. You can practice with a demo account to get a feel for how to do so before doing it the first time.
Best Online Stock Brokers
Webull, founded in 2017, is a mobile app-based brokerage that features commission-free stock and exchange-traded fund (ETF) trading. It’s regulated by the Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA).
Webull offers active traders technical indicators, economic calendars, ratings from research agencies, margin trading and short-selling. Webull’s trading platform is designed for intermediate and experienced traders, although beginning traders can also benefit.
Webull is widely considered one of the best Robinhood alternatives.
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- Does not support trading in mutual funds, bonds or OTC stocks
Moomoo is a commission-free mobile trading app available on Apple, Google and Windows devices. A subsidiary of Futu Holdings Ltd., it’s backed by venture capital affiliates of Matrix, Sequoia, and Tencent (NASDAQ: FUTU). Securities offered by Futu Inc., regulated by the Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA).
Moomoo is another great alternative for Robinhood. This is an outstanding trading platform if you want to dive deep into smart trading. It offers impressive trading tools and opportunities for both new and advanced traders, including advanced charting, pre and post-market trading, international trading, research and analysis tools, and most popular of all, free Level 2 quotes.
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- No minimum deposit to open an account.
- No chat support
E*TRADE is an online discount trading house that offers brokerage and banking services to individuals and businesses. One of the first brokers to embrace online trading, E*TRADE not only survived both the dot-com bubble and Recession — it thrived. You can choose from two different platforms (one basic, one advanced). E*TRADE is a suitable broker for traders of most skill levels, whether you want to buy mutual funds and hold them for decades or dabble in options swing trading. E*TRADE offers a library of research and education materials to help you out.
- Active traders
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- No paper trading on its standard platform
This latest groundbreaking technology is IBKR GlobalAnalyst, a new trading tool that helps investors compare the rate of PEG or price-earnings growth valuations and provide more immediate and comprehensive financial metrics of stocks, globally.
Recognizing that stock selection can be challenging for investors to compare the valuations of domestic and international stocks, Interactive Brokers created GlobalAnalyst to offer investors a simple, yet powerful tool to easily evaluate investment opportunities around the world.
Using GlobalAnalyst, investors can search for stocks by region, country, industry, market capitalization and currency to uncover undervalued stocks worldwide. The resulting table displays the current market and financial metrics, including the PEG Ratio. The PEG Ratio is the PE ratio divided by the three-year compound earnings growth rate, and smaller PEG Ratios typically indicate undervalued companies.
- Price earnings growth valuations
- Easily evaluate investment opportunities
CenterPoint Securities is ideal for active traders who demand access to advanced tools and services. While investors and casual traders are likely to be content with the basic offerings of traditional online brokerages, active traders will benefit from CenterPoint’s suite of advanced trading tools. If you value execution quality, access to short inventory, advanced trading platforms, and accessible customer service, CenterPoint is an excellent choice.
- Intermediate to Advanced traders
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- Short sellers
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- Flexible order routing for improved executions
- Discounts for active traders
- Advanced platform with fast executions
- Reliable customer service
- Not designed for beginner or low-volume traders
Future outlook for Walmart
In some ways, Walmart is exceptionally predictable, especially given its size and scale. Yet there are no sure bets when it comes to investing. Still, analysts generally acknowledge that the company is uniquely positioned to square off against Amazon, its reputation for providing a high-quality customer experience is steadily improving and the company seems to be making significant progress in growing the online side of the business.
Time will ultimately tell whether Walmart lives up to long-term expectations, but currently, WMT stock appears to be a reasonable value.
Purchasing stock can seem like a complex process, especially when managing multiple companies. Couple that with the extensive amount of research that may be needed to analyze an investment, and many investors opt for mutual funds or exchange-traded funds (ETFs) instead.
Take the time to do your homework, and be sure you have a solid understanding of, and appreciation for, risk. For those would-be investors who want to enter the market in a relatively safe manner, blue-chips like Walmart — with decades-long, reliable performance — can be a great starting point.