This Is No Bargain
Wal-Mart (WMT) hit a new 12-year high of $66.66 intraday Thursday. That peak price represented 15x trailing earnings and about 13.6x the full-year estimate of $4.90 for the fiscal year ending Jan. 31, 2013. Wal-Mart shares are up 38% from their August 2011 low of $48.30. If you've held since, then you've also collected $1.13 in dividends for a nine-month total return of 40%.
Wal-Mart is now expected to see year-over-year profit growth of 10.1%. Last summer the company reported its eight straight quarter with same-store sales decreases. If you limited your purchase of retailing names to only those with increasing comps, you could not have bought Wal-Mart, even though it was at its cheapest valuation ever. The stock was selling for 10.9x that year's earnings per share and yielding an all-time high 3.02%....494 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.
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