From its humble beginnings of a single location opened in 1962, to its current status as one of the world’s true juggernaut companies, Wal-Mart Stores, Inc. (NYSE:WMT) is an amazing American success story. The company sells virtually everything, and operates more than 10,000 retail stores in more than 25 countries. As an investment, there are few stocks that boast a similar track record of rewards for shareholders. The Walton family, which owns roughly 48% of the company, should be considered a modern American dynasty. At recent valuations, the net worth of the Walton family is more than $110 billion. Wal-Mart is an American business wonder with a massive size and scale of almost unbelievable proportion.
In February, Wal-Mart Stores, Inc. (NYSE:WMT) released its fiscal fourth-quarter and full-year fiscal 2013 results. The company reported full-year total revenue of $469 billion, an increase of 5% versus the prior year. To put Wal-Mart’s gigantic sales in perspective, if Wal-Mart were its own nation it would rank among the top 30 countries by gross domestic product. Its $469 billion in sales would almost match the GDP of Poland, according to 2012 estimates from the International Monetary Fund. Furthermore, Wal-Mart Stores, Inc. (NYSE:WMT) employs more than 2 million people, only about a half million fewer than the population of Chicago.
Wal-Mart Stores, Inc. (NYSE:WMT) competes with other discount retailers including Target Corporation (NYSE:TGT) and Costco Wholesale Corporation (NASDAQ:COST). Target is a $40 billion company that competes directly with Wal-Mart. In November, Target reported adjusted earnings per share of $0.90, up 4.3% from the third quarter 2011. Target also provided fourth quarter earnings guidance of $1.64-$1.74. Target generated trailing twelve-month revenue of almost $72 billion.
Costco is another successful discount retailer that competes with both Wal-Mart Stores, Inc. (NYSE:WMT) and Target. Costco has had solid growth in sales and earnings since the financial crisis, and even better share price performance. The stock has increased more than 70% since the beginning of 2010. Costco’s net sales and net income have grown 8% and 7.7%, respectively, over the last four years. Costco brought in more than $100 billion in sales over the past year.
Both Target and Costco are great businesses, but as you can see, their numbers pale in comparison to Wal-Mart’s. Not only does Wal-Mart do more sales than both of these companies, but you could add the total sales from Target, Costco, Sears, and Kroger, and still not equal Wal-Mart’s annual sales.
Wal-Mart’s Stellar Shareholder Friendliness
If all that weren’t enough, the company is one of the most shareholder-friendly stocks in existence. In 2012, the company paid returned $13 billion to shareholders in the form of dividends and share buybacks. Furthermore, in conjunction with the quarterly and full-year results, Wal-Mart Stores, Inc. (NYSE:WMT) announced it will increase its fiscal 2014 dividend by 18%. Wal-Mart has increased its dividend every year since the first declared dividend of $0.05 per share in March 1974. The dividend has doubled over the past five years.
Based on Wal-Mart’s fiscal 2013 results of $5.02 in earnings per share, the stock trades for slightly more than 14 times. In addition, the company expects fiscal 2014 profits to be in a range of $5.20 per share to $5.40 per share, meaning the stock trades at 13.5 times the midpoint of next year’s expected earnings. With a gigantic business, shareholder friendly management, and a modest valuation, if you’re considering investing in American business, Wal-Mart should be on your watch list.
The article This Retailer Has a Truly Amazing Story! originally appeared on Fool.com and is written by Robert Ciura.
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