What has been the performance of Walmart stock throughout the pandemic?

Few would have foreseen Walmart stock's trajectory two years ago. At the time, the corporation had bolstered its omnichannel presence in order to compete more effectively against Amazon, Costco and other competitors.
 
WAN CHAI, Hong Kong - March 4, 2022 - PRLog -- COVID-19-related shutdowns on the other hand, provided unanticipated advantages to the firm. It benefited from the demand for consumer basics and the closures of many small rivals, in addition to having the infrastructure to facilitate online orders and pickups. Can the prosperity continue in a post-lockdown world?

Over the previous two years, Walmart's stock has returned approximately 17%. All of those wins were made between March and November of 2020. Walmart stayed open in most areas when the virus broke out and civilizations throughout the world went into lockdown. Walmart's sales increased since it was able to provide fundamental necessities while also servicing online and omnichannel clients who were hesitant to enter a physical store. Nonetheless, as cultures learnt to adjust to the pandemic and immunizations improved, purchasing habits began to approximate pre-pandemic behaviour and stock prices began to trade in a range. The stock has grown by less than 8% since August 2020.

Furthermore, Walmart has underperformed the S&P 500 total return, which has increased by about 50% in the previous two years. While some may claim that Walmart is as safe as they come, the only time it beat the overall market was during the lockdowns.

The stock's underperformance might be attributed to the company's financials. Revenue of $416 billion increased by 3% in the first nine months of the fiscal year for 2022 compared to the same time in 2021. During that time however, net income dropped by 35% to just over $10 billion. Earnings were dragged down by net losses on the changing value of stock assets and a loss on the sale of Walmart Argentina.

It also had a significant impact on free cash flow. The first nine months of the fiscal year for 2022 generated just $7.7 billion in free cash flow, less than half of the $16.4 billion earned in the same time during the previous year. Nonetheless, the overall statistics show a deceleration from the fiscal year of 2021, when revenue increased by 7% and net income declined by 10% due to growing expenses and higher income taxes.

Walmart's stock may easily continue to rise. The stock has historically tracked the overall returns of the S&P 500. Nonetheless, save during the height of the lockdowns, Walmart has underperformed the indices during the previous two years.

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