Your SlideShare is downloading. ×

Why Warren Buffett Still Believes in Wal-Mart

612

Published on

Dividends and buybacks can sometimes be an investor's best friend.

Dividends and buybacks can sometimes be an investor's best friend.

Published in: Economy & Finance, Business
0 Comments
3 Likes
Statistics
Notes
  • Be the first to comment

No Downloads
Views
Total Views
612
On Slideshare
0
From Embeds
0
Number of Embeds
2
Actions
Shares
0
Downloads
10
Comments
0
Likes
3
Embeds 0
No embeds

Report content
Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

Cancel
No notes for slide
  • https://www.flickr.com/photos/fooleditorial/14115074914/
  • https://www.flickr.com/photos/fooleditorial/10261002993/in/photolist-gz16vz-gyZhyR-gyYRVb-gCrgGt-gCJjGH-gySw3X-gyQErM-khBmcE-khyTyp
  • https://www.flickr.com/photos/fooleditorial/14114765135/
  • Transcript

    • 1. Why Buffett Still Believes in Wal-Mart
    • 2. Some Might Call Buffett’s Investment Mediocre
    • 3. But They’re Forgetting the Power of Dividends
    • 4. Consistent Dividends O Back in late 2005, Wal-Mart paid out $0.60 per share in dividends. O At the time, that meant Berkshire collected $12 million per year in dividends. O Fast forward to today, and Wal-Mart pays out $1.92 in dividends per year. O That means Berkshire will collect $111 million in dividends alone this year from Wal- Mart.
    • 5. Wal-Mart Has Consistently Grown It’s Dividend
    • 6. The Best Part About the Dividend? O Over the past 12 months, Wal-Mart has brought in $12 billion in free cash flow. O At the same time, it has paid out just $6.1 billion in dividends. O That means Wal-Mart is only using about half of its free cash flow to pay its dividend. O Wal-Mart’s payout, therefore, is both sustainable, and has lots of room for growth.
    • 7. But That’s Not All… O Wal-Mart has also been using its excess cash to buy back shares of the company. O This lowers the number of shares outstanding, which gives each shareholder more value. O During 2013 alone, the company bought back 89 million shares, reducing the number of shares outstanding by 3%.
    • 8. Since 2005, This Has Reduced the Number of Shares by 24%
    • 9. For More Dividend Winners… If you’re an income investor looking for some high-yielders that are off the beaten path, check out the Motley Fool’s special free report: Top Dividend Stocks for the Next Decade

    ×