Microsoft vs Walmart Which Is More Profitable?

Both Microsoft and Walmart are iconic companies in the world of business, representing two of the largest corporations in their respective industries. Microsoft, a technology giant, has seen rapid growth and success in recent years with its innovative products and services. On the other hand, Walmart, a retail powerhouse, has maintained its position as a dominant player in the retail sector globally. Both stocks have had their ups and downs, making the comparison between them an interesting and dynamic one.

Microsoft or Walmart?

When comparing Microsoft 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 Microsoft 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. Microsoft has a dividend yield of 0.69%, while Walmart has a dividend yield of 0.88%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Microsoft reports a 5-year dividend growth of 10.16% year and a payout ratio of 24.63%. 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 Microsoft P/E ratio at 36.73 and Walmart's P/E ratio at 38.50. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Microsoft P/B ratio is 11.55 while Walmart's P/B ratio is 8.60.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Microsoft has seen a 5-year revenue growth of 0.99%, while Walmart's is 0.34%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Microsoft's ROE at 34.56% and Walmart's ROE at 23.31%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $445.58 for Microsoft and $93.04 for Walmart. Over the past year, Microsoft's prices ranged from $366.28 to $468.35, with a yearly change of 27.87%. Walmart's prices fluctuated between $50.51 and $96.18, with a yearly change of 90.41%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.