It’s hard to fathom a world without it Walmart (NYSE:WMT). The company opened its first discount store in the early 1960s and conducted its initial public offering (IPO) in October 1970.
If you were lucky and smart to buy just one share in your early days as a publicly traded company, subsequent stock splits would leave you with many more.
Exactly how many shares would you own? Tracing the history of the stock split and doing some multiplication will provide the answer.
Walmart has announced twelve stock splits since its IPO. Most were 2-for-1 splits, but the exception was February’s 3-for-1 split.
Every time a 2-for-1 split occurred, your share count doubled, and in February the count tripled. So your one share has changed into 6,144 shares.
The unadjusted split price was $16.50. As your number of shares increased, the price decreased by the same amount. That means the $16.50 becomes a split-adjusted $0.0027 (i.e., well under a cent per share). The stock closed at $94.25 on December 13, giving long-term investors a nice profit.
You would also have been receiving dividends for over 50 years. Walmart’s first quarterly payout was made in March 1974, and the board of directors has increased it every year since. That makes the company a Dividend King.
The quarterly payout was last increased in February. Walmart currently pays $0.2075 per quarter, more than 9% more than last year’s split-adjusted $0.19.
Walmart’s simple business plan of keeping costs low and passing savings on to customers has resonated with shoppers. It has also proven to be very profitable and rewarding for shareholders. With its ultra-low daily prices, it’s difficult for competitors to undercut the company, and this should continue to pay off for patient shareholders.
Consider the following before buying stock in Walmart:
The Motley Fool Stock Advisor The analyst team has just identified what they think is the 10 best stocks for investors to buy now… and Walmart wasn’t one of them. The ten stocks that survived the cut could deliver monster returns in the coming years.
Think about when Nvidia made this list on April 15, 2005… if you had $1,000 invested at the time of our recommendation, you would have $800,876!*
Stock Advisor provides investors with an easy-to-follow blueprint for success, including portfolio building guidance, regular analyst updates and two new stock picks per month. The Stock Advisor is on duty more than quadrupled the return of the S&P 500 since 2002*.
