WMTCAUTIOUS

EV/EBITDA

21.4x

Higher than 100% of Consumer Defensive sector peers

Updated 345h ago

Sector Performance

100th percentile

WMT

21.4x

Sector Median

10.3x

Sector Avg

10.1x

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Deep Analysis

EV/EBITDA, or enterprise value to earnings before interest, taxes, depreciation, and amortization, measures a company's total value relative to its operating cash profit; at 21.4x, Walmart trades at a premium price for each dollar of EBITDA.

This valuation is well above the Consumer Defensive sector median of 13.0x, placing Walmart in the 91st percentile among its peers. Year-over-year change is not available, but the metric has declined 5.9% quarter-over-quarter from 22.8x to 21.4x. Although the current 21.4x multiple remains elevated versus the sector, the recent decline suggests some compression in valuation may be occurring, reducing the extreme premium slightly. This combination of a high absolute level with a downward trend implies that while risk persists due to expensive pricing, the recent drop could offer a less stretched entry point. The high EV/EBITDA ratio supports the overall CAUTIOUS verdict, as investors are paying a substantial premium for Walmart’s earnings power relative to its industry.

Frequently Asked Questions

What does the EV/EBITDA tell investors about WMT?

A valuation multiple preferred by analysts for capital-intensive or leveraged businesses. Useful for cross-sector comparisons where earnings can be distorted by debt.

How is the EV/EBITDA calculated?

EV/EBITDA is calculated as: Enterprise Value / EBITDA.

How does WMT's EV/EBITDA compare to its sector?

WMT's EV/EBITDA of 21.4x compares to a Consumer Defensive sector median of 10.3x, placing it in the 100th percentile.

Who are WMT's closest peers by EV/EBITDA?

The closest Consumer Defensive peers by EV/EBITDA include: MO (8.9x), ADM (11.6x), ABEV (6.8x), PM (17.9x), DNUT (-6.4x).

The Formula

Enterprise Value / EBITDA

Why It Matters

A valuation multiple preferred by analysts for capital-intensive or leveraged businesses. Useful for cross-sector comparisons where earnings can be distorted by debt.