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10/16/2026 | Press release | Distributed by Public on 10/16/2026 19:05
Should You Pick Walmart Stock Over Its Competitors
Walmart (WMT) stock trades at 42.5 times earnings. Among the six retailers in its peer group, only Costco Wholesale is priced higher. Walmart ranks lower on business performance than on price. Over the latest four fiscal quarters, Walmart sits third out of six on revenue growth and fourth on operating margin. So how does Walmart's price look beside the rival that grows fastest?
Walmart Trades At Twice Amazon's P/E With Slower Growth
Amazon.com is the fastest grower in the group. It trades at 20.2 times earnings. Net income exceeded operating income at Amazon, meaning items outside its operations added to the earnings behind that P/E. Amazon revenue rose 15.8% over its latest four fiscal quarters, compared with 6.2% at Walmart. Amazon also posted an operating margin of 12.1%, well above the 4.4% at Walmart. Amazon is a broadline retailer, and Walmart is a consumer staples merchant. The two margins come from different kinds of business.
Costco operates in Walmart's own industry. It is priced higher at 47.1 times earnings. Costco's revenue also grew faster than Walmart's, rising 10.1%. Target and Home Depot are priced below Walmart and grew more slowly. Walmart maintains a price near the top of the group, while its growth sits in the middle and its margin sits in the lower half.
| WMT | AMZN | COST | TGT | KR | HD | |
|---|---|---|---|---|---|---|
| Four Fiscal Quarters | ended 2026-07-31 (Q3 FY2026 to Q2 FY2027) | ended 2026-06-30 (Q3 FY2025 to Q2 FY2026) | ended 2026-08-30 (Q1 FY2026 to Q4 FY2026) | ended 2026-08-01 (Q3 FY2025 to Q2 FY2026) | ended 2026-08-15 (Q3 FY2025 to Q2 FY2026) | ended 2026-08-02 (Q3 FY2025 to Q2 FY2026) |
| Market Value (USD billion) | 939 | 2728 | 435 | 70.9 | 38 | 306 |
| P/E | 42.5 | 20.2 | 47.1 | 16.1 | 35 (not in the P/E rank) | 21.5 |
| Revenue Growth | 6.2% | 15.8% | 10.1% | 2% | 1.6% | 2.5% |
| Operating Margin | 4.4% | 12.1% | 3.9% | 5.6% | 1.4% | 12.4% |
| Share Price Change, 2025-10-14 to 2026-10-15 | 9.2% | 17.5% | 3.1% | 78.6% | -7.2% | -18.4% |
Data as of 10/15/2026. Revenue growth, operating margin, and net income in the P/E are for each company's four fiscal quarters in the first row; revenue growth is against the four quarters before. A P/E marked "not in the P/E rank" belongs to a company whose net income was below zero in at least one of those four quarters.
Holding a large amount of Walmart instead of spreading it across rivals ties your plan to one company. See how to protect a concentrated position.
What Are You Buying At Walmart's Price?
Investors buying Walmart at this price are mostly buying its home market. The Walmart U.S. segment brought in $486 billion of the company's $713 billion revenue in fiscal 2026. The retailer sells at such high volume that a small change in margin represents a lot of money. In fiscal Q2 2027, with sales of $188 billion, each percentage point of margin is worth about $1.9 billion of operating profit.
Walmart is finding its faster growth in businesses built around those sales. The global advertising business grew 38% in fiscal Q2 2027. Walmart's membership fee revenue rose 17%. Management said almost half of Walmart's profit growth came from areas such as membership, advertising and marketplace, a trend the company expects to continue. The current share price appears to assume Walmart keeps growing these businesses fast enough to lift its margin.
Is Walmart's Profit Growing Faster Than Its Sales?
Management expects exactly that for fiscal 2027. In August, Walmart raised its forecast for adjusted operating income growth to 7% to 8.5%, compared with 4% to 5% for sales growth, both excluding currency moves. During fiscal Q2 2027, Walmart's reported operating margin rose to 5.0%, up from 4.1% a year earlier.
Management said adjusted operating income grew 17.4% in that quarter, excluding currency moves. Tariff refunds Walmart received added about 7.5 percentage points of that growth. Walmart is putting much of the refund money back into lower prices. The company is expected to report its fiscal Q3 2027 results on or around November 19, 2026. For that quarter, management forecast operating income growth of 2% to 4%, with the refund spending on prices included, alongside sales growth of 3% to 3.75%, both excluding currency moves. For that specific quarter, the midpoint of management's profit forecast, 3%, is below the midpoint for sales, 3.4%.
Investors picking Walmart over Amazon pay a higher P/E for slower growth. Those picking it over Costco pay a lower P/E for slower growth. Either way, the stock price appears to assume Walmart keeps growing profit faster than sales. Management's forecast for fiscal 2027 supports that expectation. Walmart's profit did grow faster than sales in fiscal Q2 2027, with help from the refunds. Operating income growth in the November report, with the refunds going into prices, is the number to watch.
Is Too Much Of Your Wealth Riding On One Stock?
Walmart is one stock among several rivals a holder could own instead. When one position grows into a large part of your wealth, a sharp fall can hurt your whole plan, and selling to spread the money out can bring a large tax bill. Glenn Caldicott, CIO of our Boston-based partner firm Empirical Asset Management, an SEC-registered investment adviser, offers a free 15-minute strategy review of ways to protect a concentrated position and unwind it with less tax.
Insight Guru Inc. published this content on October 16, 2026, and is solely responsible for the information contained herein. Distributed via Public Technologies (PUBT), unedited and unaltered, on October 17, 2026 at 01:05 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]