Walmart stock turns out to be the ideal stock for retirees to own. Naturally, they do not seek very swiftly progressing stocks that involve a lot of risks. Instead, companies that pay dividends are more suitable for this section of society.
Stability of Walmart Stock
Walmart stock is one of the safest stocks to purchase because of its strong balance sheet and very large size. Starting in the year 1962 it turns out to be the largest retailer in the world. By the end of July, the balance sheet of the company showed $16.9 billion cash and a debt of $46.9 billion. Walmart mainly focuses on keeping low costs and passes on the savings to customers at low prices. Walmart makes the reduction procedure a priority for the company. The policy that the company follows makes it so popular for its customers.
Dividend raises every year
Not only is the financial strength of the company comforting, but the stocks can also be reaped by the customers at a 1.5% dividend yield. The main focus of Walmart stocks is in the security of the stocks. They have been paying the dividend securely for almost forty-five long years now, it has also increased its rate of dividend every year since the initial payment in 1974. It has survived through several kinds of adverse situations like the stagflation days or the tremendous amount of recessions. Therefore, even if there are fluctuations, one can be certain about the dividend checks of this company. Also, to support the payments, the company produces plenty of free flow of cash.
Walmart Stock is still growing
The growth potential of Walmart is immense, which benefits the investors greatly. There was a 7.5% growth in the revenue in the second quarter, on a basis of constant currency amount of $140.2 billion. Every single year $98 is being charged by Walmart. This allows the customers to receive several items without paying any extra charges for the delivery. This kind of stability in the Walmart stocks makes it a perfect place of investment for retirees.
Till now the low prices of Walmart stocks have drawn a lot of investors to the company. Walmart stocks have performed exceptionally well during the downturn. During the recession period faced by the U.S markets the Walmart and Sam’s Club chain has not failed their customers and continued to make progress. In the year 2007, the company had an operating income of $20.5 billion which went up to $22.8 billion within only two years.
However, investing icons like Motley Fool’s co-founders, Tom and David Gardner did not include Walmart stock in their top ten stocks to invest in.