Wednesday, April 22, 2015

RECENT BUY - (NYSE: WMT)

WE RECENTLY PURCHASED THE FOLLOWING

Services & Providers
Wal-Mart Stores, Inc (WMT)
Purchased 8 shares of WMT today (4/22/2015) at $77.75
Total Spent: $622.00
$14.40 added to annual dividends
 
A little about Wal-Mart Stores, Inc.:
Wal-Mart is the industry leader in discount retail by a wide margin. In fact, it is the world’s largest company by revenue (according to the Fortune Global 500 list in 2014). To put things into perspective, Wal-Mart generates more sales than Costco (COST), Target (TGT), Amazon (AMZN), Kroger (KR), and Whole Foods (WF)...Combined!  Wal-Mart is also the biggest private employer in the world with more than two million employees. It's shear size and scale has thus allowed it to pressure suppliers into the best possible deals.  
 
Wal-Mart positioning itself to take advantage of growing e-commerce demand.  In fact, Wal-Mart has seen some nice growth in digital sales during the last few quarters and is therefore shifted its recent capital spending to continue its growth in digital/e-commerce sales.  It is doing so through investments in its website, mobile platform, as well as people.
 
Wal-Mart is also spending capital to leverage its success and expand its market share at the expense of local grocery store chains through its neighborhood market stores.  In fact, the company is on track to open between 180 and 200 neighborhood market stores in the US in its full fiscal 2015. 

In addition to its neighborhood market stores, Wal-Mart is also experimenting with even smaller express stores (1/10 the size of a Wal-Mart super center).
 
 
Today's Purchase:
We've been eyeing Wal-Mart for a little while now and certainly happy that we picked up a few shares of WMT earlier in the morning for $77.75 (the stock actually ended up closing .68 cents higher at $78.43).  With today's purchase of Wal-Mart Stores, Inc. (WMT), our family's dividend stocks portfolio now includes a total of 37 stocks/ETFs.

Our estimated forward dividends grew just a tad, adding another $15.68 to our yearly dividends which now stands at approximately $3,163/year.
 

Our family's dividend stocks portfolio may be found
by clicking on the link below:

We also maintain an extensive list of stock analysis
that can be access through the link below:

We also just started a list of Recent Buys by other bloggers
that can be access through the link below:
 



HERE IS A QUICK FACT SHEET FOR THE STOCK I JUST PURCHASED:
Services & Providers
Wal-Mart Stores, Inc (WMT)
P/E: 15.53
Payout Ratio: 38%
Dividend Yield: 2.499%
Dividend Growth rate (5yr AVG): 11.62%
41 consecutive years of dividend increases
Last Ex-dividend date: 2/6/2015
Next Ex-dividend date: approx. 5/6/2015
Have paid a dividend since: 1973 (42 years)
Pays a dividend 4 times a year.

Market Cap: 253 Billion
52-week high: $90.97
52-week low: $72.61

Purchased Price: $77.75

What are your thoughts about my recent purchase?

What are you buying?

15 comments:

  1. Personally, I'm not a fan of any retailer. I know many like TGT and WMT has been becoming quite popular among the dividend bloggers in recent days I see. I know WMT has a great dividend history as does TGT but I feel that there are serious long term headwinds these retailers can potentially face. The only 'retailer' I own is GWW. Not a retailer in the traditional sense but kind of is. In any case, thanks for sharing your recent buy.

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    1. Thanks DivHut for your perspective. Whether we agree or disagree, we always welcome everyone's thoughts. Retailers are certainly not high flyers of the market but we feel (if bought at the right price), they can be decent investments. Of TGT and WMT, we feel WMT is the better value. We do also own TGT, but we bought in last summer when they were still dealing with the failed launch into Canada and residuals of the security breach of their credit card system.

      Thanks for stopping by and for the comment. Best Wishes! AFFJ

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  2. WMT is a fine holding for the long term. I don't think that they will be disrupted anytime soon, but their growth is likely to be modest. They've got some headwinds with their recent decision to pay their workers more, a trend that very well could continue. I wouldn't expect much appreciation, but overall return over the next decade should be in the high single digits with low chance of downside.

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    Replies
    1. Our feeling exactly Brian...we agree with pretty much everything you said. WMT, as others, certainly have some challenges to overcome. We think the current price reflects the risks though. And at the end of the day, if we get returns in the high single digits, we would be satisfied. :) AFFJ

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  3. I like WMT at this price level, Dividend Monk did an analysis recently and I like what I saw as well. The only thing I dont like is the dividend growth has been lagging lately, hopefully they won't follow T's dividend growth of penny a quarter, hopefully not and I see this as temporary because they are having issues with the labor cost increasing salaries of their employees and having a better health coverage, but once they get this out of the way I see WMT can have a better business model and can increase their dividend like they used to.

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    Replies
    1. Yes, I agree. Both dividend yield and dividend growth could be a bit higher. I guess we are just hoping that with the payout ratio still somewhat low, that will provide WMT with more room for to grow that yield. Something near 3% would be welcomed. :)

      I think that in the long run, WMT will be up near or even above 3%. AFFJ

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  4. I think this entry point is a great buy for the long term. I added 16 shares to my account just a couple days ago.

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    Replies
    1. Good to hear from a fellow shareholders. At current prices, we thought WMT was a great buy and we definitely plan to keep WMT for awhile. You cant go wrong buying the worlds largest company (by revenue) can you? :)

      To future dividends and hopefully also some growth! AFFJ

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  5. I have my eyes on WMT as well. Great company at great price. Can't wait to own it.

    BeSmartRich

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    1. Would certainly welcome you as a fellow shareholder Be Smart Rich. The more the merrier! :) Hopefully the market cooperates and you have an opportunity to buy in at your desired price. AFFJ

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  6. Good buy at a great price. I've been doing the same in a slower fashion by picking up $100 a month in WMT shares with Loyal3. Keep up the good work

    Dividend Dreams

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    Replies
    1. Small or big, keep adding to those annual dividend payouts Dividend Dreams. Good to hear your a fellow shareholder. We are certainly glad to have the chance to buy in at what we felt was a great price.

      Thanks for the encouragement. AFFJ

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  7. FFJ,

    I think WMT is a great buy. I have been keeping my eye on it for a while now. And you're right, they are making a lot of sales. To think that they make more sales than AMZN, and AMZN shot up today, shows a good future for WMT. The divs are great too. I decided to pick up some GOOG, AMZN, and AAPL, and WMT is likely next for me.

    Great buy! Can't wait to read more!

    D2R

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    Replies
    1. Right, its hard to believe that anyone can rack up that much sales. I know a few people who say then refuse to go to WMT because of the type of employees and people that are there but they if their online sales soar, it will be hard for people online to ignore their competitive prices. And if it is online, the excuse of going into the store goes out the door (literally!). :)

      AFFJ

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