Stock Analysis on Net
Stock Analysis on Net
Microsoft Excel LibreOffice Calc

Walmart Inc. (NYSE:WMT)

Return on Capital (ROC)

Advanced level

Return on capital (ROC) is after tax rate of return on net business assets. ROIC is unaffected by changes in interest rates or company’s debt and equity structure. It measures business productivity performance.


Return on Invested Capital (ROIC)

Walmart Inc., ROIC calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Jan 31, 2020 Jan 31, 2019 Jan 31, 2018 Jan 31, 2017 Jan 31, 2016 Jan 31, 2015
Selected Financial Data (US$ in millions)
Net operating profit after taxes (NOPAT)1 18,200  9,089  12,319  17,141  16,356  18,490 
Invested capital2 167,329  158,768  142,543  148,752  155,895  150,353 
Performance Ratio
ROIC3 10.88% 5.72% 8.64% 11.52% 10.49% 12.30%
Benchmarks
ROIC, Competitors4
Amazon.com Inc. 12.59% 13.28% 5.94% 10.40% 7.00%
Costco Wholesale Corp. 16.91% 16.47% 14.89% 14.63% 13.82%
Dollar General Corp. 11.22% 10.94% 9.31% 8.86% 8.94% 8.15%
Home Depot Inc. 34.91% 35.70% 27.93% 25.73% 23.46% 22.47%
Lowe’s Cos. Inc. 18.00% 12.51% 15.33% 14.36% 12.78% 13.07%
Target Corp. 14.30% 14.14% 12.07% 12.75% 12.12% 10.31%
TJX Cos. Inc. 19.13% 18.60% 16.31% 16.38% 18.59% 19.20%

Based on: 10-K (filing date: 2020-03-20), 10-K (filing date: 2019-03-28), 10-K (filing date: 2018-03-30), 10-K (filing date: 2017-03-31), 10-K (filing date: 2016-03-30), 10-K (filing date: 2015-04-01).

1 NOPAT. See details »

2 Invested capital. See details »

3 2020 Calculation
ROIC = 100 × NOPAT ÷ Invested capital
= 100 × 18,200 ÷ 167,329 = 10.88%

4 Click competitor name to see calculations.

Performance ratio Description The company
ROIC A measure of the periodic, after tax, cash-on-cash yield earned in the business. Walmart Inc.’s ROIC deteriorated from 2018 to 2019 but then improved from 2019 to 2020 exceeding 2018 level.

Decomposition of ROIC

Walmart Inc., decomposition of ROIC

Microsoft Excel LibreOffice Calc
ROIC = OPM1 × TO2 × 1 – CTR3
Jan 31, 2020 10.88% = 4.52% × 3.11 × 77.46%
Jan 31, 2019 5.72% = 2.84% × 3.21 × 62.80%
Jan 31, 2018 8.64% = 3.65% × 3.48 × 68.03%
Jan 31, 2017 11.52% = 4.93% × 3.24 × 72.23%
Jan 31, 2016 10.49% = 5.26% × 3.07 × 64.96%
Jan 31, 2015 12.30% = 5.84% × 3.21 × 65.62%

Based on: 10-K (filing date: 2020-03-20), 10-K (filing date: 2019-03-28), 10-K (filing date: 2018-03-30), 10-K (filing date: 2017-03-31), 10-K (filing date: 2016-03-30), 10-K (filing date: 2015-04-01).

1 Operating profit margin (OPM). See calculations »

2 Turnover of capital (TO). See calculations »

3 Effective cash tax rate (CTR). See calculations »

The primary reason for the increase in return on invested capital (ROIC) over 2020 year is the increase in profitability measured by operating profit margin (OPM) ratio.


Operating Profit Margin (OPM)

Walmart Inc., OPM calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Jan 31, 2020 Jan 31, 2019 Jan 31, 2018 Jan 31, 2017 Jan 31, 2016 Jan 31, 2015
Selected Financial Data (US$ in millions)
Net operating profit after taxes (NOPAT)1 18,200  9,089  12,319  17,141  16,356  18,490 
Add: Cash operating taxes2 5,296  5,384  5,789  6,591  8,823  9,686 
Net operating profit before taxes (NOPBT) 23,496  14,473  18,108  23,732  25,179  28,176 
 
Net sales 519,926  510,329  495,761  481,317  478,614  482,229 
Profitability Ratio
OPM3 4.52% 2.84% 3.65% 4.93% 5.26% 5.84%
Benchmarks
OPM, Competitors4
Amazon.com Inc. 6.37% 6.29% 3.30% 4.62% 3.15%
Costco Wholesale Corp. 3.30% 3.41% 3.31% 3.23% 3.31%
Dollar General Corp. 9.65% 9.52% 9.56% 10.23% 10.43% 10.17%
Home Depot Inc. 14.80% 14.70% 15.10% 14.77% 13.94% 13.32%
Lowe’s Cos. Inc. 8.61% 6.38% 9.56% 9.72% 9.07% 9.26%
Target Corp. 6.17% 5.67% 6.18% 7.35% 7.67% 6.41%
TJX Cos. Inc. 11.23% 11.30% 11.44% 11.94% 12.79% 13.18%

Based on: 10-K (filing date: 2020-03-20), 10-K (filing date: 2019-03-28), 10-K (filing date: 2018-03-30), 10-K (filing date: 2017-03-31), 10-K (filing date: 2016-03-30), 10-K (filing date: 2015-04-01).

1 NOPAT. See details »

2 Cash operating taxes. See details »

3 2020 Calculation
OPM = 100 × NOPBT ÷ Net sales
= 100 × 23,496 ÷ 519,926 = 4.52%

4 Click competitor name to see calculations.

Profitability ratio Description The company
OPM The operating profit margin (OPM) is the ratio of pretax economic earnings, or NOPBT, to sales. Walmart Inc.’s OPM deteriorated from 2018 to 2019 but then improved from 2019 to 2020 exceeding 2018 level.

Turnover of Capital (TO)

Walmart Inc., TO calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Jan 31, 2020 Jan 31, 2019 Jan 31, 2018 Jan 31, 2017 Jan 31, 2016 Jan 31, 2015
Selected Financial Data (US$ in millions)
Net sales 519,926  510,329  495,761  481,317  478,614  482,229 
Invested capital1 167,329  158,768  142,543  148,752  155,895  150,353 
Efficiency Ratio
TO2 3.11 3.21 3.48 3.24 3.07 3.21
Benchmarks
TO, Competitors3
Amazon.com Inc. 2.21 2.28 2.26 3.20 3.24
Costco Wholesale Corp. 6.35 6.80 6.81 6.29 6.55
Dollar General Corp. 1.45 1.42 1.35 1.35 1.35 1.27
Home Depot Inc. 3.01 3.17 2.87 2.75 2.62 2.59
Lowe’s Cos. Inc. 2.69 2.86 2.47 2.39 2.41 2.29
Target Corp. 2.83 2.86 2.66 2.57 2.57 2.41
TJX Cos. Inc. 2.29 2.30 2.22 2.22 2.30 2.23

Based on: 10-K (filing date: 2020-03-20), 10-K (filing date: 2019-03-28), 10-K (filing date: 2018-03-30), 10-K (filing date: 2017-03-31), 10-K (filing date: 2016-03-30), 10-K (filing date: 2015-04-01).

1 Invested capital. See details »

2 2020 Calculation
TO = Net sales ÷ Invested capital
= 519,926 ÷ 167,329 = 3.11

3 Click competitor name to see calculations.

Efficiency ratio Description The company
TO The turnover of capital (TO) is the ratio of sales to invested capital. Capital turnover is a function of the efficiency of working capital management and of net fixed assets. Walmart Inc.’s TO deteriorated from 2018 to 2019 and from 2019 to 2020.

Effective Cash Tax Rate (CTR)

Walmart Inc., CTR calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Jan 31, 2020 Jan 31, 2019 Jan 31, 2018 Jan 31, 2017 Jan 31, 2016 Jan 31, 2015
Selected Financial Data (US$ in millions)
Net operating profit after taxes (NOPAT)1 18,200  9,089  12,319  17,141  16,356  18,490 
Add: Cash operating taxes2 5,296  5,384  5,789  6,591  8,823  9,686 
Net operating profit before taxes (NOPBT) 23,496  14,473  18,108  23,732  25,179  28,176 
Tax Rate
CTR3 22.54% 37.20% 31.97% 27.77% 35.04% 34.38%
Benchmarks
CTR, Competitors4
Amazon.com Inc. 10.59% 7.26% 20.39% 29.64% 31.33%
Costco Wholesale Corp. 19.18% 28.98% 34.06% 27.96% 36.17%
Dollar General Corp. 19.88% 18.75% 27.64% 35.82% 36.32% 36.89%
Home Depot Inc. 21.74% 23.26% 35.67% 36.71% 35.80% 34.80%
Lowe’s Cos. Inc. 22.32% 31.40% 34.96% 38.25% 41.52% 38.25%
Target Corp. 18.12% 12.76% 26.52% 32.40% 38.55% 33.25%
TJX Cos. Inc. 25.59% 28.37% 35.80% 38.22% 36.75% 34.74%

Based on: 10-K (filing date: 2020-03-20), 10-K (filing date: 2019-03-28), 10-K (filing date: 2018-03-30), 10-K (filing date: 2017-03-31), 10-K (filing date: 2016-03-30), 10-K (filing date: 2015-04-01).

1 NOPAT. See details »

2 Cash operating taxes. See details »

3 2020 Calculation
CTR = 100 × Cash operating taxes ÷ NOPBT
= 100 × 5,296 ÷ 23,496 = 22.54%

4 Click competitor name to see calculations.

Tax rate Description The company
CTR Effective cash tax rate on operating income. Walmart Inc.’s CTR increased from 2018 to 2019 but then decreased significantly from 2019 to 2020.