As stated above Wal-Mart started only 38 stores during its inception at which time it only had 1, 500 human resources and a sales of $ 44. 2 million. Its first stock split took place in the year 1971 and had a market value of $47. During the time, Wal-Mart was only operating in a few towns. Currently, Wal-Mart has a market capitalization of US$ 232 Billion. As at 2007, its revenues were US$ 387. 7 Billion with an operating income of US$ of 22 Billion while the total net income standing at US$ 12. 7 Billion. The total assets were valued at US$ 163. 5 Billion while its total equity was US$ 64. 61.
At the same time the capital were approximately 2, 100, 000 as at the year 2008 (Money & Co, Wal-Mart returns to darling status on Wall Street) The financial standing of Wal-Mart today is good. First, retailer’s shares are up at 75 cents at $54. 89 the highest level so far since the month of November, 2004 when the company achieved an estimate range of 74-76 cents per share up from 70-74 range as the earnings of the first quarter. The current position is almost a 16% improvement given the fact the shares had been operating at a neutral level for the past three years at an average of $42 and $51.
In 2005, the shares were low at 11. 4%, lower at 1. 3% in 2006 and only achieving 2. 9% in 2007. According to Wal-Mart, the store sales raised to 1. 2% during March by 0. 7% apart from its gasoline sales (Money & Co, Wal-Mart returns to darling status on Wall Street). Given the above financial standing, by putting in place the correct financial measures, an organization such as Wal-Mart is capable of financial muscle which can enable the organization to avoid incurring unnecessary expenditure (Dalrymple, Get Rich with Good Habits).
On the surface this looks a simple task but there is need to state here that achieving the above objective is not easy objective to achieve. The implication here is that as an organization which is in several business operations, it is an uphill task for the financial manager or whoever is in charge of managing the financial portfolio of the company to come up with the best policy which will ensure that the company does not incur unnecessary expenditure. Several proposals have however been cited. First, the organization needs to pay all her bills at the right time.
The implication here is that as an organization, she is bound to have some debt obligations to meet. In normal business practice, it is a normal procedure to transact some business operations on credit with the intention of meeting those liabilities later. The reasons for incurring debt could be varied and could range form acquiring capital for expansion of operations to others like acquiring goods on credit (Dalrymple, Get Rich with Good Habits). The financial standing of Wal-Mart could equally be analyzed in the context of its sales reports.
The sales are looked at from the context of the percentage changes, as well as by capturing the element of fuel prices. For instance, for the period ending March, 2007 from February, 2008, the Wal-Mart stores alone reported a quarterly result of $ 18. 6 billion from a previous $17. 6. This represented a 5. 6 percentage change. In general, the whole company having consolidated other sales aspects recorded total sales of $ 29. 2 billion in March 2008 up from a total of $ 26. 8 in February 2007. This was an impressive 8. 9 % increase in sales (Schumacher & Simley, Wal-Mart Reports February Sales).