First, there is the stock price, which you can see went sideways from 1999 until 2012 (13 years sideways).
Second, there is MarketCap, which shows WMT was worth roughly $300 billion back in 1999.
Third is "After-Tax Margin", which is positive the entire time through two major recessions.
Fourth is "Dividend Yield". We all like to earn a return for holding onto an investment.
Fifth is "Shares Outstanding". You can see that WMT is buying back their shares, reducing the supply.
Sixth window is the "Price/Sales/Share" which is what do you pay to own WMT as a multiple of the revenues.
The PSR is WMT was once a MIGHTY 2 (monthly closing basis) and has fallen down to a lowly 0.5 now. Revenues keep growing steadily and have risen 6%-7% each year. If you add in that WMT has reduced the number of shares by 3%-4% each year, then sales have grown by roughly 10% per year. Add to the mix that WMT always makes a profit of at least 3% and you have a very stable company to analyze. Certainly, the future is clouded by their ability to grow and by the internet/Amazon/online challengers, but their performance is solid over the long term.
TradingView gives you the tools to "see" a stock and diagnose where the value is coming from very quickly and easily. These days the market is buying growth in revenues more than real, tangible, after-tax , but that is the nature of markets.
I offer up my equation that I use to value stocks: A "Fair" Price-to-Sales Ratio is the result of "growth of sales (net of shares issued/redeemed) and a profit margin" and then multiply that by 10 to get it to a PSR . So, in Walmart's terms, Sales growth of 10% + 3% profit margins = 13% or .13. Multiply by 10 to get 1.3. In an ideal world, WMT is worth 1.3x's sales. It is trading at 0.5x's Sales now, so it would have to rise by 160% to get to "Fair Value" from this equation. The market is clearly NOT INTERESTED in Walmart at this time.
Tim 11:34AM 8/20/2014 Wednesday