QoD: Walmart vs. Amazon: Which has been the better performing stock over the past five years?

Jan 14, 2020
Investing, Question of the Day, Index Funds

Answer: AMAZON by a long shot!

  1. Reviewing the chart, how much would your $100 investment five years ago have grown if you had invested in...
    1. Amazon?
    2. Walmart?
    3. The overall stock market (S&P 500)? 
  2. Would you have been better off choosing between these 2 companies or just buying the overall stock market through an index fund?
  3. Why do you think that Amazon has performed so much better than Walmart? (Hint: Do you think that online ecommerce is growing faster than “bricks and mortar” retail?

Here's the ready-to-go slides for this Question of the Day that you can use in your classroom.

Behind the Numbers:

Forbes had an article just this week that questions the future dominance of Amazon.  The reason?  The astronomical shipping costs facing Amazon.  Could this be one time when having a vast brick and mortar presence puts Walmart in a good position to compete with Amazon?  If you look at stock returns for just the past year, the answer looks like a definite maybe! 

**Want to try this at home? You can do it for any stocks!

  1.   Pull historical stock information from Yahoo Finance for 5 years for each company and drop in Google sheet.

(1a. Sort columns to reverse the date order.)

  1.   Using the Adj. Close column (which accounts for dividends), index the first day in the series to 100. How? Divide each of the adj. stock prices by that first day’s stock price. 
  2.   Then arrange three columns with one being date, second being first company’s stock prices indexed to first day in the series and the third for the other company’s indexed stock prices.
  3.   Highlight those three fields, and Insert>Chart and voila you have the stock comparison chart you see above. 


For similar comparisons, try these stock match-ups:

About the Author

Beth Tallman

Beth Tallman entered the working world armed with an M.B.A. in finance and thoroughly enjoyed her first career working in manufacturing and telecommunications, including a stint overseas. She took advantage of an involuntary separation to try teaching high school math, something she had always dreamed of doing. When fate stepped in once again, Beth jumped on the opportunity to combine her passion for numbers, money, and education to develop curriculum and teach personal finance at Oberlin College. Beth now spends her time writing on personal finance and financial education, conducting student workshops, and developing finance curricula and educational content. She is also the Treasurer of Ohio Jump$tart Coalition for Personal Financial Literacy.