Analyses / AMZN vs WMT
AMZN vs WMT
Side by Side
| AMZN | WMT | |
|---|---|---|
| Company | Amazon.com Inc | Walmart Inc |
| Price | $226.65 | $114.22 |
| Today | — | — |
| Valuation | OVERVALUED on FCF, FAIR on revenue growth | Overvalued on trailing multiples; fair on growth + quality |
| Valuation score | 62/100 | 38/100 |
| Setup | Growth / AI-driven capex story | Value + Income Hybrid |
| Confidence | medium | 68 |
| Category | Large Cap | Large Cap Retail |
The Case for Each
AMZN
Bull: Strong revenue growth (11.7% YoY, 13.2% 5Y CAGR), solid operating margin expansion (11.16%), and dominant AWS moat. AI infrastructure buildout could drive incremental cloud revenue. Trading 19% below 52-week high near recent lows, creating entry point if capex efficiency improves.
Bear: Forward P/E of 31.8x vs. 27x trailing indicates near-term growth premium. Price-to-FCF of 321x signals expensive cash generation vs. peers. AI projects showing runaway spending risk; insider selling 4.4x buyback activity (3.9M sold vs. 1.2M bought). Rising capex without proven ROI may pressure margins.
WMT
Bull: Strong 24% YoY EPS growth + 5.3% revenue expansion signal pricing power and operational leverage. 0.76% dividend yield + 34% payout ratio = sustainable income. Low beta (0.60) offers portfolio ballast. Trading ~16% below 52-week high; room to re-rate if growth sustains.
Bear: Trailing P/E 39.8x and forward 41.4x remain elevated for 5% organic revenue growth. P/FCF 60.7x suggests thin free cash generation relative to valuation. Current ratio 0.79 + quick ratio 0.20 indicate tight working capital; heavy insider selling (215 sells vs 75 buys) signals caution. Macro slowdown risk if consumer softens.
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