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The firm enjoys an outstanding management and corporate culture. Consensus estimates call for the company to earn about $4.83 per share this year, up from $4.42 per share last year, and to go to about $5.01 per share next year.
Walmart has paid dividends to investors since 1973, and has increased its payments for 45 consecutive years, which makes it a dividend aristocrat. During the past 5 years it has increased its dividends at an average rate of 3.54%, and its quarterly payment of $0.52 per share currently provides a yield of 2.50%.
Technically, Walmart also looks attractive, trading 24.8% below its 52 weeks high, while it is forming a price consolidation pattern between $110 and $82 approximately, in which $82 is acting as a technical support level.
Its direct investment plan charges some fees for cash investing ($5 plus 5 cents per share) but the plan charges no fee for dividend re-investment. To illustrate those fees: for example, a $100 investment at WMT’s current price would cost a fee of $5.06 (or 5.06% of the investment).
To minimize the effect of even such small fees, you may want to invest a larger amount but less frequently. The fee for a $300 investment, for instance, would be $5.18 (or 1.73% of the investment).
With the stock being fundamental and technically attractive, this may be an excellent entry point for investors with a longer-term investment horizon.
Mario Medina is a contributing editor to DirectInvesting.
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