Walmart vs Home Depot Which Is Stronger?

Walmart and Home Depot are two retail giants with a significant presence in the stock market. Walmart, known for its wide range of products and affordable prices, has been a stable and reliable investment for many years. On the other hand, Home Depot, specializing in home improvement products, has seen consistent growth due to the booming housing market. Both stocks have their unique strengths and weaknesses, making them attractive options for investors seeking to diversify their portfolios.

Walmart or Home Depot?

When comparing Walmart and Home Depot, 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 Walmart and Home Depot.

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. Walmart has a dividend yield of 0.96%, while Home Depot has a dividend yield of 2.17%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Walmart reports a 5-year dividend growth of 1.85% year and a payout ratio of 41.18%. On the other hand, Home Depot reports a 5-year dividend growth of 15.20% year and a payout ratio of 58.41%.

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 Walmart P/E ratio at 43.56 and Home Depot's P/E ratio at 27.36. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Walmart P/B ratio is 8.02 while Home Depot's P/B ratio is 91.45.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Walmart has seen a 5-year revenue growth of 0.34%, while Home Depot's is 0.61%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Walmart's ROE at 18.91% and Home Depot's ROE at 678.08%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $84.12 for Walmart and $405.82 for Home Depot. Over the past year, Walmart's prices ranged from $49.85 to $85.54, with a yearly change of 71.61%. Home Depot's prices fluctuated between $287.24 and $421.56, with a yearly change of 46.76%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.