Reddit's Loudest Walmart Critics Have a Point About That 46x Multiple

"Walmart posted Q4 adjusted EPS of $0.74, beating the $0.73 estimate, and revenue of $190.7B, topping estimates by 3.6%. The business is genuinely evolving: eCommerce now represents 23% of Walmart U.S. net sales, the global advertising business hit nearly $6.4B, and store-fulfilled expedited delivery grew more than 60%."

"But FY27 guidance called for net sales growth of only 3.5% to 4.5%, missing the ~5% Wall Street expected. That miss, combined with a trailing P/E of roughly 46x, is what set Reddit ablaze."

"Walmart is Schrödinger's stock: somehow both a bond proxy defensive that deserves a dirt-cheap discount rate and a hyper-growth monster that deserves a nosebleed multiple."

Walmart's stock declined 4.1% over the past month to $123.49 despite beating Q4 earnings and revenue estimates. The company posted adjusted EPS of $0.74 versus $0.73 expected and revenue of $190.7B, exceeding estimates by 3.6%. Walmart demonstrated significant business transformation with eCommerce representing 23% of U.S. net sales, advertising revenue reaching $6.4B, and store-fulfilled expedited delivery growing over 60%. However, FY27 guidance projecting 3.5-4.5% net sales growth disappointed Wall Street's ~5% expectations. Reddit investors expressed strong bearish sentiment, criticizing Walmart's 46x trailing P/E valuation as unjustifiable given its modest growth projections, comparing it unfavorably to competitors like Coca-Cola with similar growth rates.

Read at 24/7 Wall St.