Saturday, November 30, 2019

Walmart dividends

This is a calculation I made several years ago and I sent it to the Walmart head office but did not hear back from them. They are reluctant to do this since their market strategy is based on everyday low prices. Walmart USA has about 1.4 million full and part time hourly employees. If they each received a $10 per hour raise based on a 40 hour week the cost would be $28 billion dollars. Walmart US sales last year were $332 billion. If they raised their prices by 8% they could give these people the $10 per hour raise. The question is would the average Walmart shopper be willing to pay $324 for a $300 TV if they knew that the extra cost would go to wages for the hourly employees. This would increase their wages from $14 per hour to $24 per hour. Walmart world wide profits after expenses were $9.8 billion in 2018, $13.6 billion in 2017 and $14.7 billion in 2106. Walmart pays a $2 dividend on its 3 billion outstanding shares and the rest is retained for investment in the business.

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