Without question, the smartest way to invest is for the long term.
As part of that overall strategy, publicly traded companies must be selected that will prosper in the years ahead. It does little good to hold for the long term in the business goes under. Wal-Mart (NYSE: WMT) is a stock that should provide a solid total return to finance retirement goals.
Wal-Mart is the biggest retailer in the world and the largest private employer in the United States.
In the current bull market, it has done well. For 2013, Wal-Mart is up nearly 15%. In recent market action, it has risen more than 4.8% for the last month.
For the long term, it is best if a stock pays a dividend.
Wal-Mart is a “Dividend Aristocrat.” That means that it belongs to a select group of stocks that have increased their dividend annually for the last 25 years or more. While the average dividend yield for a member of the Standard & Poor’s Index is around 1.9%, for Wal-Mart it is 2.44%.
Due to its size, growth at Wal-Mart is modest.
But the stock is selling at a discount. The price-to-sales ratio for Wal-Mart is just 0.53. That means that every dollar of sales is going for nearly a 50% discount in the stock price. For a company the prominence of Wal-Mart, that is a big discount.
It is most likely to remain that way. But the company is profitable and Warren Buffett is a major shareholder. Those are two very important features for any investment.