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Everyone knows Walmart (NASDAQ: WMT). It's a retail behemoth, with a recent market value of roughly $1 trillion and some 10,900 stores in 19 countries. It employs about 2.1 million people worldwide and serves some 280 million customers. (With Earth's population of 8 billion people, there's clearly room for growth for Walmart, despite its large size.) Indeed, Walmart is one of Earth's largest employers.
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Here's how the stock has performed, on an average annual basis, in the past:
Data source: Data from Morningstar.com as of Nov. 10, 2026.
Clearly, the company has been doing well in recent years. (The stock gained 73.5% in 2024 alone!) But all that growth has left the stock rather overvalued, with a recent price-to-sales ratio of 1.37, well above the five-year average of 0.85, and a recent forward-looking price-to-earnings (P/E) ratio of 38, well above the five-year average of 27.
So, should you invest in Walmart? I would hold off, as you'd be paying a steep per-share price. The stock will likely continue to grow over the coming decades, but it may also retreat to a more reasonable valuation in the next year or two -- especially if there's a stock market crash.
Think of it this way: The stock was recently priced around $126 per share. If you buy now and it hits $200 in five years, you'll enjoy a roughly 60% gain -- about 10% annually on average. But if you choose to wait, hoping for a better price, and you can snag shares at, say, $100 per share, you'll enjoy a 100% gain when the shares hit $200 (about 15% annualized).
Buying some shares now could serve you well, as long as you're planning to hold for many years. But there are other, less richly valued portfolio candidates out there, too.
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Selena Maranjian has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Walmart. The Motley Fool has a disclosure policy.
Is Walmart (WMT) Stock Too Expensive to Buy Now? was originally published by The Motley Fool
