Alphabet vs Walmart Which Is Superior?

The stocks of Alphabet Inc., the parent company of Google, and Walmart Inc., one of the world's largest retailers, are both popular choices for investors seeking long-term growth. Alphabet's innovative technologies and dominant position in online advertising have propelled its stock price to record highs, while Walmart's strong brand name and massive network of stores have continued to make it a preferred option for value investors. Both companies offer unique opportunities and risks for investors looking to diversify their portfolios.

Alphabet or Walmart?

When comparing Alphabet and Walmart, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Alphabet and Walmart.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Alphabet has a dividend yield of 0.32%, while Walmart has a dividend yield of 0.66%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Alphabet reports a 5-year dividend growth of 0.00% year and a payout ratio of 5.22%. On the other hand, Walmart reports a 5-year dividend growth of 1.85% year and a payout ratio of 33.23%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Alphabet P/E ratio at 24.14 and Walmart's P/E ratio at 38.63. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Alphabet P/B ratio is 7.24 while Walmart's P/B ratio is 8.63.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Alphabet has seen a 5-year revenue growth of 1.47%, while Walmart's is 0.34%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Alphabet's ROE at 31.66% and Walmart's ROE at 23.31%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $182.67 for Alphabet and $93.77 for Walmart. Over the past year, Alphabet's prices ranged from $131.06 to $193.31, with a yearly change of 47.50%. Walmart's prices fluctuated between $50.08 and $96.18, with a yearly change of 92.07%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.