There are currently eight publicly traded companies with a market capitalization of $1 trillion or more: Nvidia, Apple, Microsoft, Alphabet, Amazon, Metaplatforms, TeslaAnd Berkshire Hathaway.
These stocks are very well known, and for good reason: they have made many investors rich. However, none of these stocks are particularly known as dividend stocks, and so far the billion-dollar club has excluded longtime dividend payers. However, that could soon change.
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Walmart (NYSE:WMT)The world’s largest retailer and the largest company in the world by revenue has quietly blown away the rest of the retail industry in recent years as its commitment to omnichannel selling and its reputation for everyday low prices have fueled steady growth. Meanwhile, many of its peers have struggled with inflation and weak consumer spending.
Walmart reported another round of strong quarterly results Tuesday morning. Sales growth was strong across the board, with comparable sales growth of 5.3% in US stores (excluding fuel), the best performance in at least five quarters. And Sam’s Club, the members-only department store chain, reported Composites growth of 7% excluding fuel.
In the international segment, which has historically been a challenging segment for the company, constant currency sales increased 12.4% to $30.3 billion. Overall, revenue rose 5.5% to $169.6 billion, beating consensus by $166.6 billion.
The retailer also delivered solid margin improvement, with gross margin increasing 21 basis points to 24.2%, thanks to lower markdowns in US stores and strong inventory management. Overall operating margin also grew, while operating income rose 8.2% to $6.7 billion. Adjusted earnings per share (EPS) rose from $0.51 to $0.58, ahead of the $0.53 consensus.
Walmart’s stores performed well, but also benefited from emerging growth businesses such as advertising, where sales rose 28%, and global e-commerce remains strong with sales up 27% as it gains market share from Amazon and other competitors.
The company also raised its expectations and showed greater confidence in the holiday quarter. It now expects net sales to rise 4.8% to 5.1% and full-year adjusted earnings per share to be $2.42 to $2.47.
Walmart’s market cap hit the $700 billion mark for the first time on Tuesday, November 19, meaning the company is approaching a market cap of $1 trillion. At its current valuation, the stock would only need to grow by 43%, which seems feasible given its recent momentum. The stock is up 66% so far this year, although it will be difficult to repeat that performance next year.