WMT — Walmart Inc.

Will it survive?

• Can it pay its interest? —
  No meaningful interest burden
  Little or no interest expense reported

  Little or no interest expense reported — the business isn't leaning on lenders to operate.

• How heavy is the debt? 1.3×
  Conservative
  Total debt $38.2B ÷ operating income $29.8B

  Years of operating profit it would take to repay all debt. A first read, not a credit rating: it's gross debt (not netted against cash) over EBIT (not EBITDA), and a cyclical year distorts it.

• How long is cash tied up? —
  Not enough data

  The filing data didn't include the inputs for this check.

Is it a good business?

• Return on invested capital 18%
  High
  NOPAT $22.4B ÷ invested capital $127.1B (debt + equity − cash)

  The rate the business earns on the money tied up in it — Buffett's north star, because over time a stock tracks the ROIC beneath it. Above ~15% sustained hints at a moat; below ~8% the company may destroy value as it grows. Asset-light businesses (R&D expensed, little capital) read artificially high — pair this with Owner Earnings.

• Owner Earnings (free cash) margin 2%
  Thin
  Owner Earnings $14.9B = operating cash $41.6B − capex $26.6B

  What an owner could take out without starving the business. That's 2% of revenue. Honest caveat: capex here blends maintenance and growth, so steady-state Owner Earnings may run higher (see capex vs. depreciation).

• Are earnings backed by cash? 1.90×
  Cash-backed
  Cash from ops $41.6B ÷ net income $21.9B

  How much of reported profit showed up as operating cash. Above 1× is reassuring; well below suggests earnings lean on accruals. One year is noisy — growth and working-capital swings distort it, and this is operating cash, not free cash. Watch the multi-year trend.

How is the cash used?

• Where do the earnings go? 105%
  Returns most of it
  Dividends + buybacks $15.6B ÷ Owner Earnings $14.9B

  Of $14.9B Owner Earnings, $15.6B (105%) went back to shareholders — $7.5B dividends, $8.1B buybacks. Returning most of it signals a mature cash machine; reinvesting most could mean a long runway — or empire-building. The split doesn't say which; the return earned on it (see ROIC) does.

• Investing or harvesting? 2.50×
  Expanding
  Capex $26.6B ÷ depreciation $10.7B

  Descriptive, not a grade. Above ~1× means investing faster than assets wear out (growth — or, sustained for years, today's earnings carrying less depreciation than tomorrow's will). Below means spending less than it's wearing out (efficiency — or a melting asset base). The ratio won't tell you which; the filings will.

Durability — 2019–2026

A moat is high return that doesn’t fade. Here are the quality metrics across a full cycle — judge the consistency, not the latest dot.

• Return on invested capital ≥15% in 4 of 8 years
  18%
• Operating margin
  4%
• Owner Earnings margin
  2%