Financial Analysis of Wal-Mart

1321 WordsApr 3, 20136 Pages
Financial Analysis of Wal-Mart Stores, Inc. Introduction On July 2, 1962, Sam Walton opened the first Walmart discount store in Rogers, Arkansas. Walmart is in the discount store industry and its principal competitors are Kmart, Target, ShopKo, and Meijer. Walmart’s culture has been built on a common purpose: saving people money so they can live better. By 1967, Walton had opened 24 stores and had generated $12.7 in sales. The company was officially incorporated as Walmart Stores, Inc. in 1969, and became publicly traded on the New York Stock Exchange in 1972. In 1983, the first Sam’s Club membership warehouse was opened and in 1988 opened the first Walmart supercenter, which features a complete grocery department in addition to…show more content…
Although preferred stock is listed on the pie chart below, Walmart has authorized 100 shares but has not actually issued any shares. Liquidity In fiscal year 2012, Walmart had $54.975 billion in current assets and $62.6 billion in current liabilities. The current ratio for fiscal year 2012 is 0.882, which indicates that Walmart has $0.88 in current assets for each dollar of current liabilities. In fiscal year 2011, Walmart had $52.012 billion in current assets and $58.6 billion in current liabilities. The current ratio for fiscal year 2011 is 0.887, which indicates that Walmart has $0.89 in current assets for each dollar of current liabilities. Walmart’s quick ratio for fiscal year 2012 is 0.228, and their quick ratio for fiscal year 2011 is 0.266, which indicates that Walmart could pay off 22.8% of their liabilities by liquidating current assets in fiscal year 2012 and could pay off 26.6% of their liabilities by liquidating current assets in fiscal year 2011. Asset Management The total asset turnover for fiscal year 2012 is 2.29 or 229%, which indicates that sales are 229% of its assets. The total asset turnover for fiscal year 2011 is 2.32 or 232%, which indicates that sales are 232% of its assets. The average collection period for fiscal year 2012 is 4.88 days, which is indicative of customers paying their accounts in 4.88 days, and the average collection period for fiscal year
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