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WMT Balance Sheet
a) The most recent balance sheet for Wal-Mart comes from the company's 8-K for the year ended January 31, 2011. The short-term liabilities for Wal-Mart were $58.484 billion. The long-term liabilities were $53.637 billion. Long-term debt is a component of the long-term liabilities and is listed at $43.482 billion.
b) At that point in time, the number of shares outstanding was 3.561 billion. The most recent price per share is $51.96. The market value of the equity in the company therefore is $185.03 billion.
The debt ratio is the total liabilities divided by the total liabilities + equity (aka total assets). This is $112.121...
This is $112.121 / $68.542 = 1.64
I consider these values to be within the acceptable range. They are closer to being too large, however. The company is highly leveraged, which implies a growth model. Wal-Mart's revenue, however, indicates that the company is not growing rapidly. Revenues have only increased by 4.2% in the past two years. Given the company's size, it is likely entering a state of maturity, particularly in the core U.S. market. Given that, Wal-Mart should be expected to carry less debt on its balance sheet.
I believe at this…
Works Cited:
MSN Moneycentral: Wal-Mart Stores, Inc. (2011). Retrieved March 7, 2011 from http://moneycentral.msn.com/investor/invsub/results/statemnt.aspx?lstStatement=Balance&Symbol=U.S.%3aWMT&stmtView=Ann
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