- Walmart’s strong digital and advertising growth drives a 29 percent share gain but keeps WMT dividends relatively low
- Valuation remains elevated, compressing the current yield to 0.83 percent
- Dividend growth stays steady with no signs of payout risk
Walmart’s business momentum remains strong
Walmart continues transforming into a more digital and higher margin retailer. Its online ecosystem keeps expanding at a rapid pace, with e commerce growing far faster than total sales as noted in e commerce growth (27–28 percent).
The same source highlights a surge in advertising revenue, reflected in advertising revenue growth (33–53 percent), which is significant because ads generate higher margins than traditional retail.
This shift supports the stock’s strong performance, with shares up more than 29 percent as referenced in shares up over 29 percent. Walmart continues to benefit from its logistics capabilities and its store as fulfillment model.
Valuation creates challenges for yield focused investors
Despite strong execution, Walmart now trades at a premium. The stock sits near 114 dollars with a forward P/E around 40, and the summary points to elevated multiples as indicated in valuation remains elevated.
For income investors, this high valuation suppresses yield. Walmart pays an annualized 0.94 dollars per share, resulting in a 0.83 percent yield, well below its five year average near 1.4 percent.
The latest quarterly dividend of 0.235 dollars has already gone ex dividend on December 12 and will be paid on January 5, 2026.
Dividend growth stays steady and dependable
While WMT dividends offer a modest yield, the long term growth record remains strong. Walmart has raised its dividend for decades, with recent increases modest but gradually improving.
One year dividend growth 13 percent
Five year dividend growth about 5.5 percent
Ten year dividend growth roughly 3.7 percent
The Chowder number sits near 6.3, appropriate for a defensive mega cap retailer with resilient cash flow. Free cash flow coverage remains solid, debt manageable, and no indicators suggest dividend risk.
What dividend investors should expect next
Walmart will likely continue rewarding long term shareholders, though returns will be driven more by dependable income than rapid capital gains. The long term expectation of modest upside through 2030, mentioned in modest upside to 2030, reinforces that view.
Dividend raises will likely stay in the low to mid single digit range. Yield will remain compressed unless the stock retreats from current levels.
Cash flow growth from advertising and e commerce could support slightly stronger hikes, but management prioritizes consistency over aggressive payout expansion. The premium valuation also leaves little room for error, and any slowdown in digital momentum or rising costs could create more attractive buying opportunities.
Walmart remains a classic low yield and high reliability dividend stock. It suits conservative investors focused on defensive cash flow, but current buyers face a premium valuation. For those building income positions with DRIP strategies, patience may offer better entry points for long term WMT dividends.
