How did I miss this stock? We get so busy looking at our portfolio that we miss these opportunities. Well, it just so happens that I was viewing the tweets on StockTwits and someone mentioned that Facebook (FB) has taken a higher market value than Wal-Mart (WMT). They put the stock chart side-by-side and my surprise was seeing that Wal-Mart has dropped rapidly the past 3 months.
Ok, so yes, Facebook (FB) has higher marketshare and it definitely can keep moving up higher. However, we need to have some conservative stocks that will also continue to do well for the long-term. Wal-Mart is the answer to the conservation stock picker that wants to get long-term growth, appreciation, and a steady winner.
Fundamentals are really good for Wal-Mart. It currently trades at a PE of 14.7. Compare that to its competitors Target that is running at a PE of 20.5 and you have a winner of a stock that is under-valued, under-appreciated, and you know it won’t last forever. You also get to collect a nice 2.7% dividend for owning WMT.
Can it go down further?
Of course the stock can go down further, no one holds a crystal ball. However, I’m sure big companies like Berkshire Hathaway know what they are doing when almost 5% of their portfolio is invested in Wal-Mart.