Should you drop your JP Morgan (NYSE:JPM) and Walmart (NYSE:WMT) positions after an advance?


USD 129.70  2.55  1.93%   

It looks like JP Morgan will continue to recover much faster as its share price surged up 0.27% today to Walmart's 0.2874%. As many rational traders are trying to avoid consumer defensive space, it makes sense to review Walmart a little further and understand how it stands against JP Morgan and other similar entities. We are going to break down some of the competitive aspects of both Walmart and JP Morgan.
Published over a month ago
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By analyzing existing primary indicators between Walmart and JP Morgan, you can compare the effects of market volatilities on both companies' prices and check if they can diversify away market risk if combined in one of your portfolios. You can also utilize pair trading strategies for matching a long position in JP Morgan with a short position in Walmart. Check out our pair correlation module for more information.

Let's begin by analyzing the assets.
The asset utilization indicator refers to the revenue earned for every dollar of assets a company currently reports. Walmart has an asset utilization ratio of 288.61 percent. This implies that the company is making $2.89 for each dollar of assets. An increasing asset utilization means that Walmart is more efficient with each dollar of assets it utilizes for everyday operations.
Out of tens of thousands of stocks, funds, and ETFs that trade on global exchanges each represent an individual company which you can analyze using comparative analysis. To determine which one of the two entities, such as Walmart or Amazon is a better fit for your portfolio, analyzing a few basic fundamental indicators is a good first step.

Understending Walmart dividends

A dividend is the distribution of a portion of Walmart earnings, decided and managed by the company's board of directors and paid to a class of its shareholders. Note, announcements of dividend payouts are generally accompanied by a proportional increase or decrease in a company's stock price. Walmart dividend payments follow a chronological order of events, and the associated dates are important to determine the shareholders who qualify for receiving the dividend payment. Walmart one year expected dividend income is about $1.47 per share.
Investing in dividend-paying stocks, such as Walmart is one of the few strategies that are good for long-term investment. Ex-dividend dates are significant because investors in Walmart must own a stock before its ex-dividend date to receive its next dividend.
This type of analysis is very useful when you want to generate a past dividend schedule and payout information for Walmart. Then that information in the form of graph and calendar can be used to fully explain how Du Pont dividends can provide a real clue to its valuation.

How important is Walmart's Liquidity

Walmart financial leverage refers to using borrowed capital as a funding source to finance Walmart ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Walmart financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Please check the breakdown between Walmart's total debt and its cash.

What do experts say?

Stock analysis is a method for investors and traders to make buying and selling decisions. By studying and evaluating past and current data, investors and traders attempt to gain an edge in the markets by making informed decisions.
It is good to see analyst projects for Walmart, but it might be worth checking our own buy vs. sell analysis

Correlation Between Walmart and Amazon Inc

In general, Stock analysis is a method for investors and traders to make individual buying and selling decisions. Stock correlation analysis is also essential because it can help investors realize that they may not be as diversified as they think. Risk management strategies are usually required to make sure all portfolios are properly aligned against their risk tolerance level. You can consider holding Walmart together with similar or unrelated positions with a negative correlation. For example, you can also add Amazon to your portfolio. If Amazon is not perfectly correlated to Walmart it will diversify some of the market risks out of the positively correlated stocks in your portfolio. However, the disadvantage of this sort of hedging is that it can potentially affect your investment returns throughout market cycles. When Walmart, for example, performs excellent and delivers stable returns, the negatively correlated position you locked in as a hedge may drag your returns down.
Please check pair correlation details between WMT and AMZN for more information.


Are you currently holding both Walmart and Amazon in your portfolio?
Please note if you are using this as a pair-trade strategy between Walmart and Amazon, watch out for correlation discrepancy over time. Relying on the historical price correlations and assuming that it will not change may lead to short-term losses.

Breaking it down

Revenue is income that a firm generates from business activities such us rendering services or selling goods to customers. It is a crucial part of a business and an essential item when evaluating a company's financial statements. Revenues from a firm's primary business operations can be reported on the income statement as sales revenue, net sales, or simply sales, depending on the industry in which a given company operates.
Revenue is typically recorded when cash or cash equivalents are exchanged for services or goods and can include product or services discounts, promotions, as well as early payments on invoices or services rendered in advance.

Revenue Breakdown

Now, let's check Walmart revenue. Based on the latest financial disclosure, Walmart reported 576.01 B of revenue. This is much higher than that of the Consumer Defensive sector and significantly higher than that of the Discount Stores industry. The revenue for all United States stocks is significantly lower than that of Walmart. As for JP Morgan we see revenue of 120.58 B, which is 35.6% higher than that of the Discount Stores

Walmart576.01 Billion
Sector9.43 Billion
JP Morgan120.58 Billion
576 B
120.6 B
JP Morgan

Will price continue to gain in September 2022?

The market risk adjusted performance is down to -0.2 as of today. Walmart exhibits very low volatility with skewness of -2.43 and kurtosis of 8.89. However, we advise investors to further study Walmart technical indicators to make sure all market info is available and is reliable. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Walmart's stock risk against market volatility during both bullying and bearish trends. The higher level of volatility that comes with bear markets can directly impact Walmart's stock price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different stocks as prices fall.

Walmart Implied Volatility

Walmart's implied volatility exposes the market's sentiment of Walmart stock's possible movements over time. However, it does not forecast the overall direction of its price. In a nutshell, if Walmart's implied volatility is high, the market thinks the stock has potential for high price swings in either direction. On the other hand, the low implied volatility suggests that Walmart stock will not fluctuate a lot when Walmart's options are near their expiration.

Our Takeaway on Walmart Investment

Whereas some firms under the discount stores industry are still a bit expensive, Walmart may offer a potential longer-term growth to private investors. With an optimistic outlook on your 90 days horizon, it may be a good time to purchase new shares of Walmart or increase your existing holdings in the Stock as it seems the potential growth has not yet been fully factored into the current price. Please use our equity advice module to run different scenarios to ensure your current risk level and investment horizon are fully reflective of your current investing preferences in regards to Walmart.

Editorial Staff

This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Raphi Shpitalnik do not own shares of Walmart. Please refer to our Terms of Use for any information regarding our disclosure principles.

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