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Wal-Mart de Mexico (WMMVY)
OTHER OTC:WMMVY
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Wal-Mart de Mexico
(OTC:WMMVY)
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Rating:68Neutral
Price Target:
$37.00
▲(13.88% Upside)
Action:ReiteratedDate:02/21/26
The score is primarily held back by weakening recent fundamentals (2025 revenue decline, margin compression, softer free-cash-flow conversion, and higher leverage). Technicals are moderately supportive with price above major moving averages and positive MACD, while valuation is only fair at ~23x earnings with a ~2.4% yield. Earnings-call commentary is slightly positive due to execution initiatives and profitable new businesses, but near-term macro softness and traffic pressure remain key risks.
Positive Factors
Market leadership
Scale and national footprint provide durable competitive advantages: bargaining power with suppliers, broad assortment, multi-format reach (hypermarkets, clubs, convenience), and membership club loyalty that support steady sales volumes, cost advantages, and resilience across business cycles.
Profitable new businesses (Byte)
Byte’s profitability and materially higher ticket sizes diversify revenue and boost unit economics. As Byte scales to company-level margins, it can sustainably lift overall margins, increase wallet share, and reduce reliance on low-margin categories, creating durable margin tailwinds.
Private-label & EDLP traction
Growing private-label penetration and an EDLP focus improve margin mix and customer price perception. Over time higher private‑label share can raise gross margins, increase loyalty, and protect pricing power versus peers, supporting margin sustainability if execution continues.
Negative Factors
Revenue and margin weakening
A recent decline in revenue and compressing net margin signals weaker top‑line momentum and margin pressure that could persist. If cyclical softness or category underperformance continues, cash generation and reinvestment capacity may be constrained, limiting long‑term growth.
Rising leverage
Material increase in leverage reduces financial flexibility and raises interest and refinancing risk. Higher debt amplifies exposure to cash‑flow volatility, limits buffer for restructuring or capex, and constrains the company’s ability to fund strategic investments during prolonged softness.
E‑commerce assortment & integration headwinds
Slower extended‑assortment growth and underperforming 1P categories show that scaling higher-margin online assortment is uneven. Combined with ongoing One Hallway/platform integration and fulfillment learning curves, this delays structural e‑commerce margin benefits and constrains durable online growth.
Wal-Mart de Mexico (WMMVY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$56.17B
Dividend Yield2.51%
Average Volume (3M)57.80K
Price to Earnings (P/E)20.9
Beta (1Y)0.48
Revenue Growth-3.82%
EPS Growth-15.29%
CountryUS
Employees235,132
SectorConsumer Defensive
Sector Strength42
IndustryDiscount Stores
Share Statistics
EPS (TTM)0.49
Shares Outstanding1,744,632,200
10 Day Avg. Volume43,437
30 Day Avg. Volume57,799
Financial Highlights & Ratios
PEG Ratio-1.57
Price to Book (P/B)4.14
Price to Sales (P/S)1.03
P/FCF Ratio23.37
Enterprise Value/Market Cap19.73
Enterprise Value/Revenue1.10
Enterprise Value/Gross Profit4.56
Enterprise Value/Ebitda11.31
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusModerate Sell
Number of Analyst Covering1
EPS Forecast (FY)1.89
Revenue Forecast (FY)$62.91B
Wal-Mart de Mexico Business Overview & Revenue Model
Company DescriptionWal-Mart de México, S.A.B. de C.V. owns and operates self-service stores in Mexico and Central America. The company operates discount warehouses and stores, hypermarkets, supermarkets, and membership self-service wholesale stores. It operates 2,198 Bodega Aurrerá discount stores, 294 Walmart hypermarkets, 14 Superama supermarkets, 85 Walmart Express supermarkets, and 165 Sam's Club membership self-service wholesale stores. The company also operates 572 Despensa Familiar and Palí discount stores; 98 Paiz, La Despensa de Don Juan, La Unión, and Más x Menos supermarkets; 158 Bodegas, Maxi Bodega, and Maxi Palí stores; and 36 Walmart hypermarkets in Costa Rica, Guatemala, Honduras, Nicaragua, and El Salvador. In addition, it imports and sells goods; develops properties; and manages real estate companies. The company was founded in 1958 and is headquartered in Mexico City, Mexico. Wal-Mart de México, S.A.B. de C.V. is a subsidiary of Intersalt, S. De R.l. De C.v.
How the Company Makes MoneyWal-Mart de Mexico generates revenue primarily through the sale of merchandise in its retail stores, which include both physical locations and e-commerce platforms. Key revenue streams include food and consumables, which account for a significant portion of sales, followed by general merchandise and health and wellness products. The company also benefits from strategic partnerships with suppliers that allow for competitive pricing and promotions. Additionally, WMMVY capitalizes on its membership-based warehouse clubs to drive bulk sales and customer loyalty, further enhancing its earnings. The company's focus on cost efficiency and supply chain optimization helps maintain profitability in a highly competitive retail environment.
Wal-Mart de Mexico Earnings Call Summary
Earnings Call Date:Feb 18, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Apr 29, 2026
Earnings Call Sentiment Positive
The call was cautiously optimistic. Management highlighted several operational and strategic wins — profitable new businesses (Byte), steady contribution to margins from new ventures, strong on-demand e-commerce growth (~20%), progress on private label penetration (mid-20s target), SKU rationalization (~30% cuts in small formats) and planned e-commerce network expansion (adding >20 cities). At the same time, executives emphasized a soft near-term macro environment, slight traffic weakness with ticket-led growth, a slowdown in extended-assortment e-commerce (mid-single-digit growth) driven by weak 1P categories and ongoing operational work to reduce shrink and complete One Hallway integration. Overall, positives around new-business monetization, operational initiatives, and readiness for a potential macro recovery slightly outweigh the near-term headwinds and execution risks.Q4-2025 Updates
Positive Updates
New businesses contributing to margin expansion
Management noted that new businesses (e.g., Byte, financial solutions, Walmart Connect) have been contributing roughly ~20 basis points quarter-on-quarter to gross margin (the call referenced a ~15 bps improvement in Mexico tied to other businesses). Financial solutions and Byte were key contributors in the quarter.
Byte is profitable and driving higher customer spend
Byte is already a profitable business and management expects it can reach operating margins in line with the rest of the company in the near term. Byte customers have an average ticket more than 2x that of non-Byte customers, supporting higher spend and frequency.
Strong on-demand e-commerce growth
On‑demand (fulfillment) e-commerce grew almost 20% year-on-year, reflecting improved pick/fulfillment performance and growing customer adoption of on-demand services.
Private brands and EDLP strategy gaining traction
Private label penetration showed 'good evolution' in Q4, played a key role in Bodega's strong Q4 performance, and is a central part of the enhanced EDLP strategy. Management reiterated a mid-20s percentage penetration target for private brands (midterm, with focus on Bodega).
SKU rationalization to improve availability and price perception
Walmex is reducing SKUs in smaller formats (Bodega Aurrera Express and Mi Bodega) by about 30% to devote space to high-selling items, improve on-shelf availability, and strengthen price perception and customer experience.
E-commerce operational expansion and reach
Management is expanding e-commerce reach and speed — adding more than 20 cities next quarter, mapping stores, improving on-hand accuracy and modular integrity, and progressing One Hallway integration to broaden assortment and fulfillment capability over time.
Improving macro outlook for 2026
The company expects a gradual improvement in the macro environment with GDP growth for Mexico forecast near ~1.5% for 2026 (compared with ~0% in 2025), which management believes will benefit Walmex if the company is prepared.
Negative Updates
Soft consumer environment and near-term outlook
Management described the market as 'relatively soft' and expects softness to persist into the first half of 2026, creating near-term headwinds for sales and traffic.
Traffic weakness; ticket driving growth
Same-store sales dynamics showed a slight decrease (traffic was negative or 'almost flat'), with most of the reported growth coming from higher ticket rather than higher customer traffic.
E-commerce extended assortment slowdown
Extended-assortment e-commerce grew only mid-single digits (versus on-demand ~20%), hurt by weak 1P category performance (notably TVs and seasonal items) and underperformance in promotional periods (Buen Fin and Fin Irresistible).
Operational challenges and margin volatility
Management acknowledged ongoing volatility quarter-to-quarter in margins and the need to reduce shrink/waste (especially perishables). While shrink reductions are underway (with AI/machine‑learning initiatives), these are areas of active remediation and can affect near-term commercial margins.
One Hallway and e-commerce integration still in transition
One Hallway is in a learning curve/transition phase; expansion of assortment, platform unification and fulfillment improvements are gradual and not instant — meaning e-commerce benefits will accumulate over time rather than immediately.
Smaller-format volatility
Walmart Express was noted to be a more volatile, though very small (~2% of portfolio), format — creating some variability in results at the margin.
Company Guidance
Management said formal 2026 targets are still being finalized and will be shared later (Walmex Day on March 25), but offered directional guidance: they expect a relatively soft macro in H1 with GDP for Mexico roughly 1.5% (vs ~0% growth in 2025), will double down on EDLP, availability and e‑commerce, and are preparing to benefit if market growth accelerates; concrete metrics discussed included a >30% SKU reduction in Bodega Aurrera Express/Mi Bodega, a private‑label penetration goal of at least the mid‑20s (%), Walmart Express representing ~2% of the portfolio, new businesses contributing roughly +20 basis points QoQ to gross margin (Q4 saw ~15 bps improvement cited), Byte is already profitable with Byte customers >2x average ticket and management expects Byte operating margins to reach company levels in the near term, on‑demand e‑commerce grew ~20% while the extended assortment grew mid‑single digits, they cited roughly 20 million SKUs today and plan to add >20 cities to delivery reach next quarter.Wal-Mart de Mexico Financial Statement Overview
Summary
Profitable and fundamentally resilient, but the latest year weakened: 2025 revenue declined, net margin slipped (~4.9% vs ~5.6% in 2024), free cash flow trend softened with lower cash conversion (~53% of net income), and leverage stepped up materially (debt-to-equity ~0.66 vs ~0.34–0.38 prior years).Income Statement
Wal-Mart de Mexico shows solid profitability for a discount retailer, with gross margin holding near ~23%–24% across 2020–2025 and EBIT margin generally healthy (~7%–9%). However, momentum weakened in the latest year: 2025 revenue declined (-5.171 vs. positive growth in prior years) and net margin slipped to ~4.9% from ~5.6% in 2024, indicating pressure on earnings despite still-positive operating profitability.74
Positive
Balance Sheet
The balance sheet is generally sound with equity steadily building over time, but leverage increased notably in 2025: debt-to-equity rose to ~0.66 versus ~0.34–0.38 in 2021–2024, reflecting a meaningful jump in debt. Total assets are stable to growing, yet the higher leverage reduces financial flexibility versus the prior, more conservative capital structure.68
Positive
Cash Flow
Cash generation remains positive with operating cash flow and free cash flow both solid in absolute terms, but quality and trend softened recently. Free cash flow fell in 2024 and again in 2025 (2025 free cash flow growth -0.839), and free cash flow covers only about ~53% of net income in 2025 (similar in 2024), down from stronger conversion in 2020–2023 (~0.66–0.73). This points to higher reinvestment needs and/or working-capital volatility reducing cash conversion.63
Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 948.82B | 958.51B | 886.52B | 819.17B | 736.04B |
| Gross Profit | 229.98B | 231.47B | 210.56B | 191.40B | 171.84B |
| EBITDA | 95.77B | 91.57B | 97.06B | 89.90B | 82.07B |
| Net Income | 46.79B | 53.83B | 51.59B | 48.97B | 44.14B |
Balance Sheet | |||||
| Total Assets | 496.08B | 493.89B | 436.55B | 418.81B | 394.39B |
| Cash, Cash Equivalents and Short-Term Investments | 28.64B | 36.51B | 40.67B | 47.43B | 42.82B |
| Total Debt | 156.76B | 79.73B | 75.25B | 73.35B | 64.69B |
| Total Liabilities | 260.12B | 261.02B | 237.46B | 216.34B | 208.51B |
| Stockholders Equity | 235.96B | 232.88B | 199.09B | 202.47B | 185.88B |
Cash Flow | |||||
| Free Cash Flow | 41.76B | 37.87B | 56.33B | 43.17B | 44.42B |
| Operating Cash Flow | 78.32B | 72.64B | 85.12B | 64.47B | 64.88B |
| Investing Cash Flow | -35.31B | -30.53B | -29.76B | -20.32B | -19.13B |
| Financing Cash Flow | -47.84B | -49.80B | -58.55B | -39.64B | -37.50B |
Wal-Mart de Mexico Technical Analysis
Negative
32.49
Price Trends
32.65
Negative
32.51
Negative
31.50
Negative
Market Momentum
-0.12
Positive
35.74
Neutral
0.10
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For WMMVY, the sentiment is Negative. The current price of 32.49 is below the 20-day moving average (MA) of 33.21, below the 50-day MA of 32.65, and above the 200-day MA of 31.50, indicating a bearish trend. The MACD of -0.12 indicates Positive momentum. The RSI at 35.74 is Neutral, neither overbought nor oversold. The STOCH value of 0.10 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for WMMVY.
Wal-Mart de Mexico Peers Comparison
UnderperformOutperform
Sector (62)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $447.32B | 49.15 | 30.32% | 0.59% | 8.34% | 9.58% | |
73 Outperform | $1.02T | 43.44 | 22.97% | 0.85% | 4.34% | 17.27% | |
73 Outperform | $33.69B | 19.21 | 16.45% | 1.88% | 4.86% | -4.51% | |
68 Neutral | $56.17B | 20.85 | 22.26% | 2.51% | -3.82% | -15.29% | |
63 Neutral | $54.70B | 8.81 | 24.04% | 4.79% | -2.16% | -12.66% | |
62 Neutral | $20.33B | 14.63 | -3.31% | 3.23% | 1.93% | -12.26% | |
61 Neutral | $23.55B | ― | 20.07% | ― | -39.27% | -182.36% |
* Consumer Defensive Sector Average
WMMVY
Wal-Mart de Mexico
32.34
5.74
21.58%
COST
Costco
1,006.74
-35.30
-3.39%
DG
Dollar General
151.60
79.49
110.23%
DLTR
Dollar Tree
117.85
47.69
67.99%
TGT
Target
120.08
8.63
7.74%
WMT
Walmart
127.81
32.74
34.44%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.