Walmart’s revenue growth has accelerated, driven by e-commerce, advertising, and membership income. Shares have surged over 30% in the past year, outperforming the S&P 500. However, with a high price-to-earnings ratio in the forties, concerns about overvaluation arise.

The retailer’s strong performance in core business areas and recent growth spurt have propelled the stock’s appreciation. Walmart reported a 5.8% revenue growth in Q3 of fiscal 2026, with e-commerce sales up 27% and advertising business up 53% year over year.

While Walmart has shown resilience and growth potential, its steep valuation raises concerns. With a forward price-to-earnings ratio of 39, higher than tech companies like Meta Platforms and Alphabet, the stock’s dividend yield is low at 0.8%. The question remains: is Walmart stock overvalued?

Investors considering buying Walmart stock should weigh the valuation risk. The Motley Fool Stock Advisor team identified 10 best stocks to buy now, excluding Walmart. With a history of market-crushing returns, their top picks could offer significant growth opportunities. Consider the long-term potential before investing in Walmart.

Read more at Nasdaq: Walmart Stock Has Been a Big Winner Recently. But Is It Overvalued Now?