Stock Analysis on Net

Walmart Inc. (NYSE:WMT)

Economic Value Added (EVA)

Microsoft Excel

EVA is registered trademark of Stern Stewart.

Economic value added or economic profit is the difference between revenues and costs,where costs include not only expenses, but also cost of capital.


Economic Profit

Walmart Inc., economic profit calculation

US$ in millions

Microsoft Excel
12 months ended: Jan 31, 2025 Jan 31, 2024 Jan 31, 2023 Jan 31, 2022 Jan 31, 2021 Jan 31, 2020
Net operating profit after taxes (NOPAT)1 22,003 18,517 13,880 15,307 18,130 18,200
Cost of capital2 9.76% 9.54% 9.36% 9.34% 9.14% 8.90%
Invested capital3 161,279 155,389 149,558 156,225 164,411 167,329
 
Economic profit4 6,268 3,687 (115) 721 3,097 3,313

Based on: 10-K (reporting date: 2025-01-31), 10-K (reporting date: 2024-01-31), 10-K (reporting date: 2023-01-31), 10-K (reporting date: 2022-01-31), 10-K (reporting date: 2021-01-31), 10-K (reporting date: 2020-01-31).

1 NOPAT. See details »

2 Cost of capital. See details »

3 Invested capital. See details »

4 2025 Calculation
Economic profit = NOPAT – Cost of capital × Invested capital
= 22,0039.76% × 161,279 = 6,268

Item Description The company
Economic profit Economic profit is a measure of corporate performance computed by taking the spread between the return on invested capital and the cost of capital, and multiplying by the invested capital. Walmart Inc. economic profit increased from 2023 to 2024 and from 2024 to 2025.

Net Operating Profit after Taxes (NOPAT)

Walmart Inc., NOPAT calculation

US$ in millions

Microsoft Excel
12 months ended: Jan 31, 2025 Jan 31, 2024 Jan 31, 2023 Jan 31, 2022 Jan 31, 2021 Jan 31, 2020
Consolidated net income attributable to Walmart 19,436 15,511 11,680 13,673 13,510 14,881
Deferred income tax expense (benefit)1 (663) (171) 430 (759) 1,998 329
Increase (decrease) in equity equivalents2 (663) (171) 430 (759) 1,998 329
Interest expense, debt and finance lease 2,728 2,683 2,128 1,994 2,315 2,599
Interest expense, operating lease liability3 931 924 858 855 877 970
Adjusted interest expense, debt and finance lease 3,659 3,607 2,986 2,849 3,192 3,569
Tax benefit of interest expense, debt and finance lease4 (768) (757) (627) (598) (670) (750)
Adjusted interest expense, debt and finance lease, after taxes5 2,891 2,849 2,359 2,251 2,522 2,820
Interest income (483) (546) (254) (158) (121) (189)
Investment income, before taxes (483) (546) (254) (158) (121) (189)
Tax expense (benefit) of investment income6 101 115 53 33 25 40
Investment income, after taxes7 (382) (431) (201) (125) (96) (149)
Net income (loss) attributable to noncontrolling interest 721 759 (388) 267 196 320
Net operating profit after taxes (NOPAT) 22,003 18,517 13,880 15,307 18,130 18,200

Based on: 10-K (reporting date: 2025-01-31), 10-K (reporting date: 2024-01-31), 10-K (reporting date: 2023-01-31), 10-K (reporting date: 2022-01-31), 10-K (reporting date: 2021-01-31), 10-K (reporting date: 2020-01-31).

1 Elimination of deferred tax expense. See details »

2 Addition of increase (decrease) in equity equivalents to consolidated net income attributable to Walmart.

3 2025 Calculation
Interest expense on capitalized operating leases = Operating lease liability × Discount rate
= 14,324 × 6.50% = 931

4 2025 Calculation
Tax benefit of interest expense, debt and finance lease = Adjusted interest expense, debt and finance lease × Statutory income tax rate
= 3,659 × 21.00% = 768

5 Addition of after taxes interest expense to consolidated net income attributable to Walmart.

6 2025 Calculation
Tax expense (benefit) of investment income = Investment income, before tax × Statutory income tax rate
= 483 × 21.00% = 101

7 Elimination of after taxes investment income.

Item Description The company
NOPAT Net operating profit after taxes is income from operations, but after removement of taxes calculated on cash basis that are relevant to operating income. Walmart Inc. NOPAT increased from 2023 to 2024 and from 2024 to 2025.

Cash Operating Taxes

Walmart Inc., cash operating taxes calculation

US$ in millions

Microsoft Excel
12 months ended: Jan 31, 2025 Jan 31, 2024 Jan 31, 2023 Jan 31, 2022 Jan 31, 2021 Jan 31, 2020
Provision for income taxes 6,152 5,578 5,724 4,756 6,858 4,915
Less: Deferred income tax expense (benefit) (663) (171) 430 (759) 1,998 329
Add: Tax savings from interest expense, debt and finance lease 768 757 627 598 670 750
Less: Tax imposed on investment income 101 115 53 33 25 40
Cash operating taxes 7,482 6,392 5,868 6,080 5,505 5,296

Based on: 10-K (reporting date: 2025-01-31), 10-K (reporting date: 2024-01-31), 10-K (reporting date: 2023-01-31), 10-K (reporting date: 2022-01-31), 10-K (reporting date: 2021-01-31), 10-K (reporting date: 2020-01-31).

Item Description The company
Cash operating taxes Cash operating taxes are estimated by adjusting income tax expense for changes in deferred taxes and tax benefit from the interest deduction. Walmart Inc. cash operating taxes increased from 2023 to 2024 and from 2024 to 2025.

Invested Capital

Walmart Inc., invested capital calculation (financing approach)

US$ in millions

Microsoft Excel
Jan 31, 2025 Jan 31, 2024 Jan 31, 2023 Jan 31, 2022 Jan 31, 2021 Jan 31, 2020
Short-term borrowings 3,068 878 372 410 224 575
Long-term debt due within one year 2,598 3,447 4,191 2,803 3,115 5,362
Finance lease obligations due within one year 800 725 567 511 491 511
Long-term debt, excluding due within one year 33,401 36,132 34,649 34,864 41,194 43,714
Long-term finance lease obligations, excluding due within one year 5,923 5,709 4,843 4,243 3,847 4,307
Operating lease liability1 14,324 14,430 14,301 14,492 14,375 17,964
Total reported debt & leases 60,114 61,321 58,923 57,323 63,246 72,433
Total Walmart shareholders’ equity 91,013 83,861 76,693 83,253 80,925 74,669
Net deferred tax (assets) liabilities2 5,271 5,585 5,766 5,444 6,609 4,290
Equity equivalents3 5,271 5,585 5,766 5,444 6,609 4,290
Accumulated other comprehensive (income) loss, net of tax4 13,605 11,302 11,680 8,766 11,766 12,805
Redeemable noncontrolling interest 271 222 237
Nonredeemable noncontrolling interest 6,408 6,488 7,061 8,638 6,606 6,883
Adjusted total Walmart shareholders’ equity 116,568 107,458 101,437 106,101 105,906 98,647
Construction in process5 (15,403) (13,390) (10,802) (7,199) (4,741) (3,751)
Invested capital 161,279 155,389 149,558 156,225 164,411 167,329

Based on: 10-K (reporting date: 2025-01-31), 10-K (reporting date: 2024-01-31), 10-K (reporting date: 2023-01-31), 10-K (reporting date: 2022-01-31), 10-K (reporting date: 2021-01-31), 10-K (reporting date: 2020-01-31).

1 Addition of capitalized operating leases.

2 Elimination of deferred taxes from assets and liabilities. See details »

3 Addition of equity equivalents to total Walmart shareholders’ equity.

4 Removal of accumulated other comprehensive income.

5 Subtraction of construction in process.

Item Description The company
Invested capital Capital is an approximation of the economic book value of all cash invested in going-concern business activities. Walmart Inc. invested capital increased from 2023 to 2024 and from 2024 to 2025.

Cost of Capital

Walmart Inc., cost of capital calculations

Capital (fair value)1 Weights Cost of capital
Equity2 684,238 684,238 ÷ 742,143 = 0.92 0.92 × 10.25% = 9.45%
Debt and finance lease obligations3 43,581 43,581 ÷ 742,143 = 0.06 0.06 × 4.41% × (1 – 21.00%) = 0.20%
Operating lease liability4 14,324 14,324 ÷ 742,143 = 0.02 0.02 × 6.50% × (1 – 21.00%) = 0.10%
Total: 742,143 1.00 9.76%

Based on: 10-K (reporting date: 2025-01-31).

1 US$ in millions

2 Equity. See details »

3 Debt and finance lease obligations. See details »

4 Operating lease liability. See details »

Capital (fair value)1 Weights Cost of capital
Equity2 488,962 488,962 ÷ 549,135 = 0.89 0.89 × 10.25% = 9.13%
Debt and finance lease obligations3 45,743 45,743 ÷ 549,135 = 0.08 0.08 × 4.28% × (1 – 21.00%) = 0.28%
Operating lease liability4 14,430 14,430 ÷ 549,135 = 0.03 0.03 × 6.40% × (1 – 21.00%) = 0.13%
Total: 549,135 1.00 9.54%

Based on: 10-K (reporting date: 2024-01-31).

1 US$ in millions

2 Equity. See details »

3 Debt and finance lease obligations. See details »

4 Operating lease liability. See details »

Capital (fair value)1 Weights Cost of capital
Equity2 375,801 375,801 ÷ 434,053 = 0.87 0.87 × 10.25% = 8.88%
Debt and finance lease obligations3 43,951 43,951 ÷ 434,053 = 0.10 0.10 × 4.06% × (1 – 21.00%) = 0.32%
Operating lease liability4 14,301 14,301 ÷ 434,053 = 0.03 0.03 × 6.00% × (1 – 21.00%) = 0.16%
Total: 434,053 1.00 9.36%

Based on: 10-K (reporting date: 2023-01-31).

1 US$ in millions

2 Equity. See details »

3 Debt and finance lease obligations. See details »

4 Operating lease liability. See details »

Capital (fair value)1 Weights Cost of capital
Equity2 400,219 400,219 ÷ 462,256 = 0.87 0.87 × 10.25% = 8.88%
Debt and finance lease obligations3 47,545 47,545 ÷ 462,256 = 0.10 0.10 × 3.86% × (1 – 21.00%) = 0.31%
Operating lease liability4 14,492 14,492 ÷ 462,256 = 0.03 0.03 × 5.90% × (1 – 21.00%) = 0.15%
Total: 462,256 1.00 9.34%

Based on: 10-K (reporting date: 2022-01-31).

1 US$ in millions

2 Equity. See details »

3 Debt and finance lease obligations. See details »

4 Operating lease liability. See details »

Capital (fair value)1 Weights Cost of capital
Equity2 371,093 371,093 ÷ 444,270 = 0.84 0.84 × 10.25% = 8.56%
Debt and finance lease obligations3 58,802 58,802 ÷ 444,270 = 0.13 0.13 × 4.05% × (1 – 21.00%) = 0.42%
Operating lease liability4 14,375 14,375 ÷ 444,270 = 0.03 0.03 × 6.10% × (1 – 21.00%) = 0.16%
Total: 444,270 1.00 9.14%

Based on: 10-K (reporting date: 2021-01-31).

1 US$ in millions

2 Equity. See details »

3 Debt and finance lease obligations. See details »

4 Operating lease liability. See details »

Capital (fair value)1 Weights Cost of capital
Equity2 322,795 322,795 ÷ 403,921 = 0.80 0.80 × 10.25% = 8.19%
Debt and finance lease obligations3 63,162 63,162 ÷ 403,921 = 0.16 0.16 × 4.16% × (1 – 21.00%) = 0.51%
Operating lease liability4 17,964 17,964 ÷ 403,921 = 0.04 0.04 × 5.40% × (1 – 21.00%) = 0.19%
Total: 403,921 1.00 8.90%

Based on: 10-K (reporting date: 2020-01-31).

1 US$ in millions

2 Equity. See details »

3 Debt and finance lease obligations. See details »

4 Operating lease liability. See details »


Economic Spread Ratio

Walmart Inc., economic spread ratio calculation, comparison to benchmarks

Microsoft Excel
Jan 31, 2025 Jan 31, 2024 Jan 31, 2023 Jan 31, 2022 Jan 31, 2021 Jan 31, 2020
Selected Financial Data (US$ in millions)
Economic profit1 6,268 3,687 (115) 721 3,097 3,313
Invested capital2 161,279 155,389 149,558 156,225 164,411 167,329
Performance Ratio
Economic spread ratio3 3.89% 2.37% -0.08% 0.46% 1.88% 1.98%
Benchmarks
Economic Spread Ratio, Competitors4
Costco Wholesale Corp. 8.71% 3.87% 7.93% 6.32% 2.53%
Target Corp. -0.02% 1.27% -0.50% 12.38% 2.86% 1.48%

Based on: 10-K (reporting date: 2025-01-31), 10-K (reporting date: 2024-01-31), 10-K (reporting date: 2023-01-31), 10-K (reporting date: 2022-01-31), 10-K (reporting date: 2021-01-31), 10-K (reporting date: 2020-01-31).

1 Economic profit. See details »

2 Invested capital. See details »

3 2025 Calculation
Economic spread ratio = 100 × Economic profit ÷ Invested capital
= 100 × 6,268 ÷ 161,279 = 3.89%

4 Click competitor name to see calculations.

Performance ratio Description The company
Economic spread ratio The ratio of economic profit to invested capital, also equal to the difference between return on invested capital (ROIC) and cost of capital. Walmart Inc. economic spread ratio improved from 2023 to 2024 and from 2024 to 2025.

Economic Profit Margin

Walmart Inc., economic profit margin calculation, comparison to benchmarks

Microsoft Excel
Jan 31, 2025 Jan 31, 2024 Jan 31, 2023 Jan 31, 2022 Jan 31, 2021 Jan 31, 2020
Selected Financial Data (US$ in millions)
Economic profit1 6,268 3,687 (115) 721 3,097 3,313
Net sales 674,538 642,637 605,881 567,762 555,233 519,926
Performance Ratio
Economic profit margin2 0.93% 0.57% -0.02% 0.13% 0.56% 0.64%
Benchmarks
Economic Profit Margin, Competitors3
Costco Wholesale Corp. 1.15% 0.57% 1.13% 0.94% 0.45%
Target Corp. -0.01% 0.41% -0.14% 3.52% 0.93% 0.52%

Based on: 10-K (reporting date: 2025-01-31), 10-K (reporting date: 2024-01-31), 10-K (reporting date: 2023-01-31), 10-K (reporting date: 2022-01-31), 10-K (reporting date: 2021-01-31), 10-K (reporting date: 2020-01-31).

1 Economic profit. See details »

2 2025 Calculation
Economic profit margin = 100 × Economic profit ÷ Net sales
= 100 × 6,268 ÷ 674,538 = 0.93%

3 Click competitor name to see calculations.

Performance ratio Description The company
Economic profit margin The ratio of economic profit to sales. It is the company profit margin covering income efficiency and asset management. Economic profit margin is not biased in favor of capital-intensive business models, because any added capital is a cost to the economic profit margin. Walmart Inc. economic profit margin improved from 2023 to 2024 and from 2024 to 2025.