• Evaluating whether Walmart at US$120.59 still offers value after a strong run, or whether most of the easy gains may already be behind it.
• The stock has returned 3.2% over the last 7 days, is down 5.5% over the past month, but has gained 6.9% year to date and 26.9% over the past year. It has also delivered a very large 3‑year return of 138.3% and a 5‑year return of 181.2%, which may have influenced how the market views its risk and potential.
• Recent coverage has focused on Walmart as a key consumer retailer, with attention on how it is positioned within U.S. retail and e‑commerce and how that positioning fits with broader consumer spending trends. This context helps frame why the stock has seen both shorter‑term pullbacks and longer‑term strength.
• Despite this track record, Walmart currently scores just 1 out of 6 on a set of valuation checks. The next sections break down what different valuation methods are indicating about the stock and outline a way of tying them together more effectively at the end of the article.

Walmart scores just 1/6 on our valuation checks. See what other red flags we found in the full valuation breakdown.

Approach 1: Walmart Discounted Cash Flow (DCF) Analysis

A DCF model projects a company’s future cash flows and discounts them back to today, aiming to estimate what the business might be worth based on those cash flows rather than current market sentiment.

For Walmart, the model uses a 2 stage Free Cash Flow to Equity approach. The latest twelve month free cash flow stands at about $15.2b. Analyst and extrapolated projections used in the model show annual free cash flow figures stepping up into the low to mid $30b range over the next decade, with one specific data point of $23.8b projected for 2030. Estimates beyond the first few years are extrapolated by Simply Wall St, not taken directly from analysts.

When these projected cash flows are discounted back to today and aggregated, the model arrives at an intrinsic value of about $92.86 per share. Compared with the current share price of $120.59, the DCF output suggests Walmart trades at roughly a 29.9% premium to this estimate. This indicates that the stock appears overvalued on this measure alone.

Result: OVERVALUED

Our Discounted Cash Flow (DCF) analysis suggests Walmart may be overvalued by 29.9%. Discover 47 high quality undervalued stocks or create your own screener to find better value opportunities.

Approach 2: Walmart Price vs Earnings

For profitable companies, the P/E ratio is a useful way to think about what you are paying for each dollar of earnings, which is often how the market anchors stock prices in practice. A higher P/E usually reflects higher growth expectations or lower perceived risk, while a lower P/E can indicate lower expected growth or higher risk.

Walmart currently trades on a P/E of 42.21x. This is well above the Consumer Retailing industry average P/E of 19.91x and also above the peer group average of 24.63x. On simple comparisons, the stock is priced more expensively than many industry peers.

Simply Wall St’s Fair Ratio for Walmart is 44.51x. This is a proprietary estimate of what Walmart’s P/E might be given factors such as its earnings growth profile, industry, profit margins, market cap and company specific risks. Because it incorporates these company specific drivers, the Fair Ratio can be more informative than a basic comparison against peers or industry averages that do not adjust for differences in quality or risk.

With the current P/E of 42.21x sitting slightly below the Fair Ratio of 44.51x, Walmart appears slightly undervalued on this P/E based approach.

Result: UNDERVALUED

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Upgrade Your Decision Making: Choose your Walmart Narrative

Earlier it was mentioned that there is an even better way to think about valuation, and that is through Narratives, which are simple stories you build around Walmart that connect your view of the business, your assumptions for future revenue, earnings and margins, and the fair value that drops out of those assumptions.

On Simply Wall St, Narratives sit inside the Community page and turn this story into a financial forecast, then into an estimated fair value. This allows you to compare that fair value with today’s share price and decide whether the stock looks attractive, fully priced, or expensive to you.

Because Narratives update as new information such as earnings releases or news arrives, your fair value view does not stay static. This helps keep your decision making aligned with what is actually happening at the company rather than with a once-off model.

For Walmart, one Narrative on the platform currently points to a fair value around US$70, while another sits closer to US$155. This shows how two investors using the same company can reach very different conclusions based on their views of Walmart’s e commerce push, AI adoption, margins and discount rate assumptions, and it gives you a structured way to decide where you personally sit between those extremes.

Do you think there's more to the story for Walmart? Head over to our Community to see what others are saying!

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.