After publishing an IOI Tear Sheet on Wal-Mart on October 14, I followed up my coverage of the company with an article on Forbes entitled Is Wal-Mart a Risky Stock? A Step-by-Step Review. In the Forbes article, I lay out my valuation assumptions for the company as a series of four bullet points. But a picture is worth a thousand words, so I’m posting the graphs of three key valuation drivers here. Take a look at the Forbes article as well–I think you will find the distinction I make between valuation risk and price risk to be helpful!

RevenueGraph

For my profitability measure, of course I am using Owners’ Cash Profits.

ProfitChart

I use a variant of free cash flow that takes into account the many ways companies use to invest in expansionary projects. In IOI lingo, this is called Free Cash Flow to Owners (FCFO).

FCFOChart