Wal-Mart Stores, Inc.

- Operating Model and Valuation

Wal-Mart Stores, Inc. - Summary of Financial Statements

($ in Millions, Except per Share Figures)

Historical Projected
January 31, 2011 2012 2013 2014 2015 2016 2017

Revenue: $ 421,849 $ 446,950 $ 471,317 $ 493,709 $ 515,675 $ 534,773 $ 551,404

Revenue Growth: 3.4 % 6.0 % 5.5 % 4.8 % 4.4 % 3.7 % 3.1 %

Operating Income: 25,542 26,558 28,272 29,615 30,932 32,078 33,076

Operating Margin: 6.1 % 5.9 % 6.0 % 6.0 % 6.0 % 6.0 % 6.0 %

Net Income: 15,355 15,766 17,215 18,084 18,983 19,592 20,265

Earnings Per Diluted Share: $ 4.18 $ 4.54 $ 5.12 $ 5.55 $ 6.03 $ 6.45 $ 6.92

Cash Flow from Operations: 23,643 24,255 27,687 29,119 30,368 31,304 32,171
Cash Flow from Investing: (12,193) (16,609) (14,139) (14,814) (15,477) (16,053) (16,555)
Cash Flow from Financing: (12,028) (8,458) (9,908) (13,623) (12,948) (14,383) (11,423)

Total Assets: 180,782 193,406 204,606 213,521 223,900 233,126 245,593

Total Debt + Capital Leases: 49,864 53,427 56,847 57,074 58,542 59,187 63,452
Cash & Cash-Equivalents: 7,395 6,550 10,157 10,806 12,717 13,553 17,713

EBITDA: $ 33,183 $ 34,688 $ 36,827 $ 38,576 $ 40,293 $ 41,785 $ 43,084

EBITDA Margin: 7.9 % 7.8 % 7.8 % 7.8 % 7.8 % 7.8 % 7.8 %

Wal-Mart Stores, Inc. - Valuation Multiples

Historical Projected
January 31, 2011 2012 2013 2014 2015 2016 2017

EV / Revenue: 0.7 x 0.6 x 0.6 x 0.6 x 0.6 x 0.6 x

EV / EBITDA: 8.8 x 8.3 x 7.9 x 7.5 x 7.3 x 7.1 x
P / E: 16.0 x 14.6 x 13.9 x 13.3 x 12.9 x 12.4 x
Graphs and Analysis of Financial Model Output - Wal-Mart Stores, Inc.

Wal-Mart: Revenue vs. Gross Margins Wal-Mart: Revenue, EBITDA, and Margins
$600 B 25.4 % $600 B $551 B 7.9 %
$535 B $551 B $535 B
$516 B $516 B 7.9 %
$494 B $494 B
$500 B $471 B 25.3 % $500 B $471 B
$447 B $447 B 7.8 %
$422 B $422 B

Revenue and EBITDA

EBITDA Margins
$400 B 25.2 % $400 B 7.8 %

Gross Margins
Revenue

7.8 %
$300 B 25.1 % $300 B
7.8 %
$200 B 25.0 % $200 B 7.8 %
7.7 %
$100 B 24.9 % $100 B
$33 B $35 B $37 B $39 B $40 B $42 B $43 B 7.7 %

$0 B 24.8 % $0 B 7.7 %
1/1/2011 1/1/2013 1/1/2015 1/1/2017 1/1/2011 1/1/2013 1/1/2015 1/1/2017

Revenue Gross Profit Margin Revenue EBITDA EBITDA Margin

Wal-Mart US Stores: Square Feet and Sales Per Square Foot

700 K $430

680 K 674 K $428

665 K

Sales Per Square Foot

660 K 656 K $426
Total Square Feet

646 K
640 K 637 K $424
627 K
620 K 617 K $422
606 K
600 K $420

580 K $418

560 K $416
1/1/2010 1/1/2012 1/1/2014 1/1/2016

Total Square Feet, US Stores Sales Per Square Foot

Wal-Mart Stores, Inc. - Valuation Graphs and Analysis

Annual Revenue, FY 2013 - 2014 Annual EBITDA, FY 2013 - 2014

$600 B $45 B
$40 B $39 B
$494 B $37 B
$500 B
$35 B
$471 B
$400 B $30 B
$25 B
$300 B
$20 B
$200 B $15 B
$116 B $10 B $8 B $8 B
$100 B $76 B $4 B $4 B
$107 B $5 B $2 B $2 B $3 B $3 B
$18 B $20 B $73 B
$0 B $19KSS
B $0 B
$16 DG
B TGT COST WMT DG KSS TGT COST WMT

FY 2013 FY 2014 FY 2013 FY 2014

Projected Revenue Growth, FY 2013 - 2014 Projected EBITDA Growth, FY 2013 - 2014
12% 12%

10% 10% 10% 10%

9% 9%
8% 8%

6% 6%
5% 5%
4% 4% 4% 4%

2% 1% 2% 1%

0% 0%
KSS TGT WMT COST DG KSS TGT WMT COST DG

FY 2014 Revenue Multiples FY 2014 EBITDA Multiples

1.2 x 12.0 x
1.0 x
1.0 x 10.0 x 9.6 x
8.8 x
0.8 x 7.9 x
0.8 x 0.7 x 8.0 x 7.4 x
0.6 x
0.6 x 6.0 x
4.7 x
0.4 x 0.4 x 4.0 x

0.2 x 2.0 x

0.0 x 0.0 x
KSS TGT WMT COST DG KSS TGT WMT COST DG
Wal-Mart Stores, Inc. - Operating Model and Valuation

Standalone Operating Model - Assumptions - Wal-Mart Stores, Inc.

($ in Millions, Except per Share Figures)

Company Name: Wal-Mart Stores, Inc. Effective Tax Rate: 32%

Ticker: WMT
Current Share Price: $ 73.26 Blue indicates hard-coded numbers.
Last Historical Year: 1/31/2012 Black indicates formulas and text.
Valuation Date: 3/4/2013 Green indicates links from other worksheets.
Allow Circular References? No

Operating Case: 2 Base Labels for Public Company Comparables:

1 Conservative
2 Base Trailing Twelve Months: TTM
3 Management Forward Year 1: 1/31/2013
Forward Year 2: 1/31/2014
Units: 1,000,000 Forward Year 3: 1/31/2015
Units for Square Feet: 1,000
Wal-Mart Stores, Inc. - Operating Model and Valuation

Revenue Scenarios - Wal-Mart Stores, Inc.

Historical Projected
1/31/2009 1/31/2010 1/31/2011 1/31/2012 1/31/2013 1/31/2014 1/31/2015 1/31/2016 1/31/2017

Total Revenue, Selected Case: $ 408,085 $ 421,849 $ 446,950 $ 471,317 $ 493,709 $ 515,675 $ 534,773 $ 551,404

US Stores - Sales ($MM): $ 259,919 $ 260,261 $ 264,186 $ 268,413 $ 272,439 $ 276,526 $ 280,397 $ 284,323
US Stores Sales Growth %: 0.1 % 1.5 % 1.6 % 1.5 % 1.5 % 1.4 % 1.4 %
US Stores - Square Feet: 592,256 605,852 617,067 626,686 636,713 646,264 655,958 665,141 674,453
US Stores - $ per Sq. Ft.: $ 429.01 $ 421.77 $ 421.56 $ 421.56 $ 421.56 $ 421.56 $ 421.56 $ 421.56

US Stores - Square Feet - YoY Growth:

Conservative Case: 2.3 % 1.9 % 1.6 % 1.4 % 1.2 % 1.0 % 0.8 % 0.6 %
Base Case: 2.3 % 1.9 % 1.6 % 1.6 % 1.5 % 1.5 % 1.4 % 1.4 %
Management Case: 2.3 % 1.9 % 1.6 % 1.7 % 1.7 % 1.8 % 1.9 % 2.0 %
Selected Case: Base 1.6 % 1.5 % 1.5 % 1.4 % 1.4 %

US Stores - $ per Sq. Ft. - YoY Growth:

Conservative Case: (1.7%) (0.0%) 0.0 % (0.1%) (0.1%) (0.2%) (0.2%)
Base Case: (1.7%) (0.0%) 0.0 % 0.0 % 0.0 % 0.0 % 0.0 %
Management Case: (1.7%) (0.0%) 0.0 % 0.1 % 0.1 % 0.2 % 0.2 %
Selected Case: Base 0.0 % 0.0 % 0.0 % 0.0 % 0.0 %

Int'l Stores - Sales ($MM): $ 97,407 $ 109,232 $ 125,873 $ 142,614 $ 157,874 $ 173,148 $ 186,290 $ 197,561
Int'l Stores Sales Growth %: 12.1 % 15.2 % 13.3 % 10.7 % 9.7 % 7.6 % 6.1 %
Int'l Stores - Square Feet: 244,802 265,846 286,680 328,887 361,776 390,718 418,068 443,152 465,310
Int'l Stores - $ per Sq. Ft.: $ 366.40 $ 381.02 $ 382.72 $ 394.21 $ 404.06 $ 414.16 $ 420.37 $ 424.58

Int'l Stores - Square Feet - YoY Growth:

Conservative Case: 8.6 % 7.8 % 14.7 % 9.0 % 7.0 % 5.0 % 5.0 % 4.0 %
Base Case: 8.6 % 7.8 % 14.7 % 10.0 % 8.0 % 7.0 % 6.0 % 5.0 %
Management Case: 8.6 % 7.8 % 14.7 % 11.0 % 10.0 % 9.0 % 7.0 % 6.0 %
Selected Case: Base 10.0 % 8.0 % 7.0 % 6.0 % 5.0 %

Int'l Stores - $ per Sq. Ft. - YoY Growth:

Conservative Case: 4.0 % 0.4 % 2.0 % 2.0 % 1.0 % 1.0 % 0.5 %
Base Case: 4.0 % 0.4 % 3.0 % 2.5 % 2.5 % 1.5 % 1.0 %
Management Case: 4.0 % 0.4 % 3.5 % 3.0 % 3.0 % 2.0 % 1.5 %
Selected Case: Base 3.0 % 2.5 % 2.5 % 1.5 % 1.0 %

Other - Sales ($MM): $ 47,806 $ 49,459 $ 53,795 $ 57,308 $ 60,414 $ 63,019 $ 65,104 $ 66,539
Other Sales Growth %: 3.5 % 8.8 % 6.5 % 5.4 % 4.3 % 3.3 % 2.2 %
Other - Square Feet: 80,986 80,539 81,202 81,586 81,994 82,322 82,569 82,817 82,982
Other - $ per Sq. Ft.: $ 593.58 $ 609.09 $ 659.37 $ 698.93 $ 733.87 $ 763.23 $ 786.13 $ 801.85

Other - Square Feet - YoY Growth:

Conservative Case: (0.6%) 0.8 % 0.5 % 0.4 % 0.3 % 0.2 % 0.2 % 0.1 %
Base Case: (0.6%) 0.8 % 0.5 % 0.5 % 0.4 % 0.3 % 0.3 % 0.2 %
Management Case: (0.6%) 0.8 % 0.5 % 0.7 % 0.6 % 0.5 % 0.5 % 0.4 %
Selected Case: Base 0.5 % 0.4 % 0.3 % 0.3 % 0.2 %

Other - $ per Sq. Ft. - YoY Growth:

Conservative Case: 2.6 % 8.3 % 4.0 % 3.5 % 3.0 % 2.0 % 1.0 %
Base Case: 2.6 % 8.3 % 6.0 % 5.0 % 4.0 % 3.0 % 2.0 %
Management Case: 2.6 % 8.3 % 8.0 % 7.0 % 6.0 % 5.0 % 4.0 %
Selected Case: Base 6.0 % 5.0 % 4.0 % 3.0 % 2.0 %

Membership Fees ($MM): $ 2,953 $ 2,897 $ 3,096 $ 2,982 $ 2,982 $ 2,982 $ 2,982 $ 2,982
Wal-Mart Stores, Inc. - Operating Model and Valuation

Income Statement - Wal-Mart Stores, Inc.

($ in Millions, Except per Share Figures) Historical Projected
1/31/2011 1/31/2012 1/31/2013 1/31/2014 1/31/2015 1/31/2016 1/31/2017

Revenue: $ 421,849 $ 446,950 $ 471,317 $ 493,709 $ 515,675 $ 534,773 $ 551,404

Revenue Growth: 6.0 % 5.5 % 4.8 % 4.4 % 3.7 % 3.1 %
Cost of Revenue: 314,946 335,127 352,638 369,391 385,826 400,116 412,559
Cost of Revenue % Revenue: 74.7 % 75.0 % 74.8 % 74.8 % 74.8 % 74.8 % 74.8 %

Gross Profit: 106,903 111,823 118,679 124,318 129,849 134,658 138,845

Gross Margin: 25.3 % 25.0 % 25.2 % 25.2 % 25.2 % 25.2 % 25.2 %

Sales, General & Administrative Expenses: 81,361 85,265 90,408 94,703 98,916 102,580 105,770
% Revenue: 19.3 % 19.1 % 19.2 % 19.2 % 19.2 % 19.2 % 19.2 %

Operating Income: 25,542 26,558 28,272 29,615 30,932 32,078 33,076

Investment Income: 201 162 131 203 216 318 339
Interest Expense: (2,205) (2,322) (2,137) (2,274) (2,283) (2,634) (2,663)
Pre-Tax Income: 23,538 24,398 26,265 27,544 28,865 29,761 30,751
Provision for Income Taxes: 7,579 7,944 8,405 8,814 9,237 9,524 9,840
% Pre-Tax Income: 32.2 % 32.6 % 32.0 % 32.0 % 32.0 % 32.0 % 32.0 %

Consolidated Net Income: $ 15,959 $ 16,454 $ 17,861 $ 18,730 $ 19,629 $ 20,238 $ 20,911
Less: Noncontrolling Interest Earnings: (604) (688) (646) (646) (646) (646) (646)
Net Income Attributable to Parent: $ 15,355 $ 15,766 $ 17,215 $ 18,084 $ 18,983 $ 19,592 $ 20,265

Diluted Shares: 3,670.00 3,474.00 3,364.80 3,255.60 3,146.40 3,037.20 2,928.00

Diluted Earnings per Share (EPS): $ 4.18 $ 4.54 $ 5.12 $ 5.55 $ 6.03 $ 6.45 $ 6.92

EBITDA: $ 33,183 $ 34,688 $ 36,827 $ 38,576 $ 40,293 $ 41,785 $ 43,084

EBITDA Margin: 7.9 % 7.8 % 7.8 % 7.8 % 7.8 % 7.8 % 7.8 %
EBIT: $ 25,542 $ 26,558 $ 28,272 $ 29,615 $ 30,932 $ 32,078 $ 33,076
EBIT Margin: 6.1 % 5.9 % 6.0 % 6.0 % 6.0 % 6.0 % 6.0 %
Wal-Mart Stores, Inc. - Operating Model and Valuation

Balance Sheet - Wal-Mart Stores, Inc.

($ in Millions, Except per Share Figures) Historical Projected
1/31/2011 1/31/2012 1/31/2013 1/31/2014 1/31/2015 1/31/2016 1/31/2017
Assets:
Current Assets:
Cash and Cash Equivalents: $ 7,395 $ 6,550 $ 10,157 $ 10,806 $ 12,717 $ 13,553 $ 17,713
Accounts Receivable, Net: 5,089 5,937 5,957 6,257 6,535 6,777 6,969
Inventory: 36,437 40,714 41,820 43,806 45,755 47,450 48,926
Prepaid Expenses & Other: 3,091 1,774 2,658 2,784 2,908 3,016 3,109
Total Current Assets: 52,012 54,975 60,592 63,654 67,916 70,796 76,717

Long-Term Assets:
Net PP&E: 105,098 109,603 114,731 120,127 125,788 131,678 137,768
Goodwill: 16,763 20,651 20,651 20,651 20,651 20,651 20,651
Capital Lease Assets: 2,780 2,721 2,721 2,721 2,721 2,721 2,721
Other Long-Term Assets: 4,129 5,456 5,912 6,368 6,824 7,280 7,736
Total Long-Term Assets: 128,770 138,431 144,015 149,867 155,984 162,330 168,876

Total Assets: $ 180,782 $ 193,406 $ 204,606 $ 213,521 $ 223,900 $ 233,126 $ 245,593

Liabilities & Shareholders' Equity

Current Liabilities:
Revolver / Short-Term Debt: $ 1,031 $ 4,047 $ 4,797 $ 5,547 $ 6,297 $ 7,047 $ 7,797
Accounts Payable: 33,676 36,608 38,009 39,924 41,701 43,245 44,468
Accrued Liabilities & Other: 18,748 18,180 20,055 21,007 21,942 22,755 23,462
Accrued Income Taxes: 157 1,164 252 264 277 286 295
Total Current Liabilities: 53,612 59,999 63,113 66,743 70,217 73,332 76,023

Long-Term Liabilities:
Total Long-Term Debt (All Portions): 45,347 46,045 49,070 48,902 49,975 50,225 54,095
Total Capital Leases (All Portions): 3,486 3,335 2,980 2,625 2,270 1,915 1,560
Deferred Income Taxes: 6,682 7,862 8,778 9,739 10,747 11,785 12,858
Redeemable Noncontrolling Interests: 408 404 404 404 404 404 404
Total Long-Term Liabilities: 55,923 57,646 61,232 61,670 63,396 64,329 68,917

Total Liabilities: $ 109,535 $ 117,645 $ 124,346 $ 128,414 $ 133,612 $ 137,661 $ 144,940

Equity:
Common Stock & APIC: 3,929 4,034 4,034 4,034 4,034 4,034 4,034
Treasury Stock: - - (8,000) (16,000) (24,000) (32,000) (40,000)
Retained Earnings: 63,967 68,691 80,578 92,812 105,379 117,942 130,519
Accumulated Other Comprehensive Income: 646 (1,410) (1,443) (1,476) (1,509) (1,542) (1,575)
Total Shareholders' Equity: 68,542 71,315 75,169 79,370 83,904 88,434 92,978
Noncontrolling Interests: 2,705 4,446 5,092 5,738 6,384 7,030 7,676
Total Equity: $ 71,247 $ 75,761 $ 80,261 $ 85,108 $ 90,288 $ 95,464 $ 100,654

Total Liabilities & Equity: $ 180,782 $ 193,406 $ 204,606 $ 213,521 $ 223,900 $ 233,126 $ 245,593

Balance Check: OK! OK! OK! OK! OK! OK! OK!

Wal-Mart Stores, Inc. - Operating Model and Valuation

Cash Flow Statement - Wal-Mart Stores, Inc.

($ in Millions, Except per Share Figures) Historical Projected
1/31/2011 1/31/2012 1/31/2013 1/31/2014 1/31/2015 1/31/2016 1/31/2017

Net Income: $ 15,959 $ 16,454 $ 17,861 $ 18,730 $ 19,629 $ 20,238 $ 20,911

Adjustments to Reconcile Net Income:
Depreciation & Amortization: 7,641 8,130 8,555 8,962 9,360 9,707 10,009
Goodwill Impairment: - - - - - - -
Deferred Income Taxes: 651 1,050 916 961 1,007 1,038 1,073
Changes in Operating Assets & Liabilities:
Accounts Receivable, Net: (733) (796) (20) (300) (278) (242) (192)
Prepaid Expenses & Other: 1,087 398 (884) (126) (124) (108) (94)
Inventory: (3,205) (3,727) (1,106) (1,987) (1,949) (1,695) (1,476)
Accounts Payable: 2,676 2,687 1,401 1,915 1,776 1,544 1,223
Accrued Liabilities & Income Taxes: (433) 59 963 965 947 821 717
Net Cash Provided by Operating Activities: 23,643 24,255 27,687 29,119 30,368 31,304 32,171

Cash Flow from Investing:

Capital Expenditures, Net: (12,699) (13,510) (14,217) (14,893) (15,555) (16,132) (16,633)
Sale of Property & Equipment: 489 580 535 535 535 535 535
Acquisitions, Net of Cash Acquired: (202) (3,548) (500) (500) (500) (500) (500)
Acquisitions of Capital Lease Assets: - - - - - - -
Other Investing Activities, Net: 219 (131) 44 44 44 44 44
Net Cash Used in Investing Activities: (12,193) (16,609) (14,139) (14,814) (15,477) (16,053) (16,555)

Cash Flow from Financing:

Net Change In Short-Term Borrowings: 503 3,019 750 750 750 750 750
Proceeds From Issuance Of Long-Term Debt: 11,396 5,050 5,000 5,000 5,000 5,000 5,000
Payments Of Long-Term Debt: (4,080) (4,584) (1,975) (5,168) (3,927) (4,750) (1,130)
Common Stock Cash Dividends: (4,437) (5,048) (5,328) (5,850) (6,416) (7,028) (7,688)
Common Stock Issued: - - - - - - -
Common Stock Repurchased: (14,776) (6,298) (8,000) (8,000) (8,000) (8,000) (8,000)
Payment Of Capital Lease Obligations (363) (355) (355) (355) (355) (355) (355)
Other Financing Activities, Net: (271) (242) - - - - -
Net Cash Used in Financing Activities: (12,028) (8,458) (9,908) (13,623) (12,948) (14,383) (11,423)

Effect of Exchange Rates: 66 (33) (33) (33) (33) (33) (33)

Net Change in Cash: $ (512) $ (845) $ 3,607 $ 649 $ 1,911 $ 836 $ 4,160
Beginning Cash Balance: 7,907 7,395 6,550 10,157 10,806 12,717 13,553
Ending Cash Balance: $ 7,395 $ 6,550 $ 10,157 $ 10,806 $ 12,717 $ 13,553 $ 17,713
Wal-Mart Stores, Inc. - Operating Model and Valuation

Operating Model Assumptions - Wal-Mart Stores, Inc.

($ in Millions, Except per Share Figures) Historical Projected
1/31/2010 1/31/2011 1/31/2012 1/31/2013 1/31/2014 1/31/2015 1/31/2016 1/31/2017

Days in Year: 365 365 366 365 365 365 366

Effective Cash Interest Rate: 2.7% 2.5% 2.0% 2.0% 2.0% 2.5% 2.5%
Effective Debt Interest Rate: 4.4% 4.3% 4.0% 4.0% 4.0% 4.5% 4.5%

Accounts Receivable % Sales: 1.2% 1.3% 1.3% 1.3% 1.3% 1.3% 1.3%
Accounts Receivable Days: 4.4 4.8 4.6 4.6 4.6 4.6 4.6
Inventory % COGS: 11.6% 12.1% 11.9% 11.9% 11.9% 11.9% 11.9%
Prepaid Expenses % OpEx: 3.8% 2.1% 2.9% 2.9% 2.9% 2.9% 2.9%

Accounts Payable % COGS: 10.7% 10.9% 10.8% 10.8% 10.8% 10.8% 10.8%
Accounts Payable Days: 39.0 39.9 39.4 39.4 39.4 39.4 39.4
Accrued Liabilities % OpEx: 23.0% 21.3% 22.2% 22.2% 22.2% 22.2% 22.2%

Accrued Income Taxes % Total Taxes: 2.1% 14.7% 3.0% 3.0% 3.0% 3.0% 3.0%

Depreciation & Amortization % Revenue: 1.8% 1.8% 1.8% 1.8% 1.8% 1.8% 1.8%
Deferred Income Taxes % Total Taxes: 8.6% 13.2% 10.9% 10.9% 10.9% 10.9% 10.9%

Capital Expenditures % Revenue: 3.0% 3.0% 3.0% 3.0% 3.0% 3.0% 3.0%

Dividends Per Common Share: $ 1.09 $ 1.21 $ 1.46 $ 1.59 $ 1.80 $ 2.05 $ 2.32 $ 2.64
Growth in Dividends Per Share: 10.9% 20.7% 8.9% 13.5% 13.5% 13.5% 13.5%

Basic Shares Outstanding: 3,656.0 3,460.0 3,350.8 3,241.6 3,132.4 3,023.2 2,914.0
Diluted Shares Outstanding: 3,670.0 3,474.0 3,364.8 3,255.6 3,146.4 3,037.2 2,928.0
Wal-Mart Stores, Inc. - Operating Model and Valuation

Valuation Summary - Wal-Mart Stores, Inc.

($ in Millions, Except per Share Figures)

Valuation Statistics - Wal-Mart Stores, Inc. Wal-Mart Stores, Inc. - Range of Valuation Multiples Wal-Mart Stores, Inc. - Implied Per Share Value Range

75th 25th Applicable 25th 75th

Maximum Percentile Median Percentile Minimum Wal-Mart Stores, Inc. Minimum Percentile Median Percentile Maximum
Methodology Name Multiple Multiple Multiple Multiple Multiple Figure Multiple Multiple Multiple Multiple Multiple

Public Company Comparables:

TTM TEV / Revenue: 1.2 x 1.0 x 0.8 x 0.7 x 0.4 x $ 446,950 $ 38.79 $ 71.54 $ 88.73 $ 107.61 $ 145.44
01/31/2013 TEV / Revenue: 1.1 x 0.9 x 0.8 x 0.7 x 0.4 x 471,317 37.78 73.60 90.55 106.87 140.80
01/31/2014 TEV / Revenue: 1.0 x 0.8 x 0.8 x 0.6 x 0.4 x 493,709 35.84 75.56 92.71 105.89 133.69
TTM TEV / EBITDA: 11.3 x 10.7 x 9.2 x 7.2 x 4.8 x 34,688 33.50 57.17 77.25 91.51 97.74
01/31/2013 TEV / EBITDA: 10.5 x 9.8 x 8.6 x 6.9 x 4.7 x 36,827 35.37 58.35 76.55 89.41 96.36
01/31/2014 TEV / EBITDA: 9.6 x 9.0 x 8.1 x 6.7 x 4.7 x 38,576 37.00 59.34 74.62 84.90 92.26
TTM Pro-Forma P/E: 25.3 x 21.9 x 17.7 x 13.4 x 9.7 x $ 4.54 44.11 60.98 80.54 99.55 114.75
01/31/2013 Pro-Forma P/E: 22.3 x 17.8 x 15.1 x 13.3 x 11.1 x 5.12 56.97 67.82 77.31 90.96 114.27
01/31/2014 Pro-Forma P/E: 20.1 x 15.6 x 13.7 x 12.4 x 10.1 x 5.55 56.16 68.94 75.84 86.72 111.46

Discounted Cash Flow Analysis:

5.0% - 7.0% Discount Rate and 0.8% - 2.8% Terminal FCF Growth Rate: $ 63.27 $ 76.49 $ 95.90 $ 127.21 $ 186.29
 Wal-Mart Valuation - Range of Implied Per Share Values
Public Company
Comparables:
TTM TEV / Revenue:

01/31/2013 TEV / Revenue:

01/31/2014 TEV / Revenue:

TTM TEV / EBITDA: Column N

Min to 25th
01/31/2013 TEV / EBITDA: 25th to Median
Median to 75th
01/31/2014 TEV / EBITDA: 75th to Max

TTM Pro-Forma P/E:

01/31/2013 Pro-Forma P/E:

01/31/2014 Pro-Forma P/E:

Discounted Cash Flow Analysis:

5.0% - 7.0% Discount Rate and 0.8% - 2.8% Terminal FCF Growth Rate:

$0.00 $20.00 $40.00 $60.00 $80.00 $100.00 $120.00 $140.00 $160.00 $180.00 $200.00

Min 25th Median 75th Max Min Point 25th Point Median Poi75th Point Max Max
5.0% - 7.0% Discount Rate and 0.8% - 2.8% Terminal FCF Growth Rate: $ 63.27 $ 76.49 $ 95.90 $ 127.21 $ 186.29 $ 63.27 $ 13.22 $ 19.41 $ 31.31 $ 59.07

01/31/2014 Pro-Forma P/E: 56.16 68.94 75.84 86.72 111.46 56.16 12.78 6.90 10.89 24.74
01/31/2013 Pro-Forma P/E: 56.97 67.82 77.31 90.96 114.27 56.97 10.86 9.49 13.64 23.31
TTM Pro-Forma P/E: 44.11 60.98 80.54 99.55 114.75 44.11 16.87 19.56 19.01 15.21
01/31/2014 TEV / EBITDA: 37.00 59.34 74.62 84.90 92.26 37.00 22.34 15.27 10.28 7.37
01/31/2013 TEV / EBITDA: 35.37 58.35 76.55 89.41 96.36 35.37 22.98 18.20 12.86 6.95
TTM TEV / EBITDA: 33.50 57.17 77.25 91.51 97.74 33.50 23.67 20.08 14.26 6.23
01/31/2014 TEV / Revenue: 35.84 75.56 92.71 105.89 133.69 35.84 39.72 17.15 13.18 27.80
01/31/2013 TEV / Revenue: 37.78 73.60 90.55 106.87 140.80 37.78 35.82 16.95 16.32 33.93
TTM TEV / Revenue: 38.79 71.54 88.73 107.61 145.44 38.79 32.75 17.19 18.88 37.83
Wal-Mart Stores, Inc. - Operating Model and Valuation

Comparable Public Companies - Diversified US-Based Retailers with Greater Than $10 Billion in TTM Revenue
($ in Millions, Except per Share Figures)

Operating Statistics Capitalization

Share Equity Enterprise Revenue EBITDA EPS
Company Name Price Value Value TTM 1/31/2013 1/31/2014 TTM 1/31/2013 1/31/2014 TTM 1/31/2013 1/31/2014
Costco Wholesale Corporation $ 100.73 $ 44,680 $ 41,365 $ 99,137 $ 106,560 $ 115,890 $ 3,667 $ 3,942 $ 4,287 $ 3.98 $ 4.51 $ 5.02
Target Corporation 63.12 42,987 59,676 69,865 73,301 76,050 7,453 7,820 8,113 4.30 4.52 4.79
Kohl's Corporation 46.10 11,342 14,228 18,804 19,220 19,500 2,936 3,001 3,045 4.74 4.14 4.56
Dollar General Corp. 46.34 15,961 18,453 14,807 16,080 17,650 1,766 1,918 2,105 2.23 2.85 3.28

Maximum: $ 100.73 $ 44,680 $ 59,676 $ 99,137 $ 106,560 $ 115,890 $ 7,453 $ 7,820 $ 8,113 $ 4.74 $ 4.52 $ 5.02
75th Percentile: 72.52 43,410 45,943 77,183 81,616 86,010 4,614 4,911 5,243 4.41 4.51 4.85
Median: $ 54.73 29,474 29,909 44,335 46,261 47,775 3,302 3,471 3,666 $ 4.14 $ 4.33 $ 4.68
25th Percentile: 46.28 14,806 17,397 17,805 18,435 19,038 2,644 2,730 2,810 3.54 3.82 4.24
Minimum: 46.10 11,342 14,228 14,807 16,080 17,650 1,766 1,918 2,105 2.23 2.85 3.28

Wal-Mart Stores, Inc. $ 73.26 $ 252,188 $ 303,915 $ 446,950 $ 471,317 $ 493,709 $ 34,688 $ 36,827 $ 38,576 $ 4.78 $ 5.12 $ 5.55

Valuation Statistics Capitalization Enterprise Value / Enterprise Value /

Share Equity Enterprise Revenue EBITDA P / E Multiple
Company Name Price Value Value TTM 1/31/2013 1/31/2014 TTM 1/31/2013 1/31/2014 TTM 1/31/2013 1/31/2014
Costco Wholesale Corporation $ 100.73 $ 44,680 $ 41,365 0.4 x 0.4 x 0.4 x 11.3 x 10.5 x 9.6 x 25.3 x 22.3 x 20.1 x
Target Corporation 63.12 42,987 59,676 0.9 x 0.8 x 0.8 x 8.0 x 7.6 x 7.4 x 14.7 x 14.0 x 13.2 x
Kohl's Corporation 46.10 11,342 14,228 0.8 x 0.7 x 0.7 x 4.8 x 4.7 x 4.7 x 9.7 x 11.1 x 10.1 x
Dollar General Corp. 46.34 15,961 18,453 1.2 x 1.1 x 1.0 x 10.4 x 9.6 x 8.8 x 20.8 x 16.3 x 14.1 x

Maximum: $ 100.73 $ 44,680 $ 59,676 1.2 x 1.1 x 1.0 x 11.3 x 10.5 x 9.6 x 25.3 x 22.3 x 20.1 x
75th Percentile: 72.52 43,410 45,943 1.0 x 0.9 x 0.8 x 10.7 x 9.8 x 9.0 x 21.9 x 17.8 x 15.6 x
Median: $ 54.73 29,474 29,909 0.8 x 0.8 x 0.8 x 9.2 x 8.6 x 8.1 x 17.7 x 15.1 x 13.7 x
25th Percentile: 46.28 14,806 17,397 0.7 x 0.7 x 0.6 x 7.2 x 6.9 x 6.7 x 13.4 x 13.3 x 12.4 x
Minimum: 46.10 11,342 14,228 0.4 x 0.4 x 0.4 x 4.8 x 4.7 x 4.7 x 9.7 x 11.1 x 10.1 x

Wal-Mart Stores, Inc. $ 73.26 $ 252,188 $ 303,915 0.7 x 0.6 x 0.6 x 8.8 x 8.3 x 7.9 x 15.3 x 14.3 x 13.2 x
Wal-Mart Stores, Inc. - Operating Model and Valuation

COST TGT
Costco Wholesale Corporation Target Corporation
Calendarization Calendarization
Old Partial New Partial FY TTM Old Partial New Partial FY TTM
Revenue: $99,137 $99,137 $69,865 $69,865
COGS: $86,823 $86,823 $47,860 $47,860
Gross Profit: $0 $0 $12,314 $12,314 $0 $0 $22,005 $22,005
Operating Expenses: $9,555 $9,555 $16,683 $16,683
Other Income / (Expense): $8 $8 ($866) ($866)
Pre-Tax Income: $0 $0 $2,767 $2,767 $0 $0 $4,456 $4,456
Taxes: $1,000 $1,000 $1,527 $1,527
Net Income: $0 $0 $1,767 $1,767 $0 $0 $2,929 $2,929
Amortization: $259 $259 $24 $24
Depreciation: $649 $649 $2,107 $2,107
Non-Recurring Charges: $0 $0 $0 $0
Tax Rate: 35% 35%

Net Income: $0 $0 $1,767 $1,767 $0 $0 $2,929 $2,929

EPS: $3.98 $4.30

EBITDA: $0 $0 $3,667 $3,667 $0 $0 $7,453 $7,453

EBIT: $0 $0 $2,759 $2,759 $0 $0 $5,322 $5,322

Balance Sheet Data Balance Sheet Data

Cash & Cash-Equivalents: $4,854 $794
Debt & Capital Leases: $1,382 $17,483
Preferred Stock: $0 $0
Noncontrolling Interests: $157 $0

Equity Research Projections Equity Research Projections

1/31/2013 1/31/2014 1/31/2015 1/31/2013 1/31/2014 1/31/2015
Bank: NA NA
Date: 2/27/2013 2/27/2013
Revenue: $106,560 $115,890 NA $73,301 $76,050 $81,440
EBITDA: $3,942 $4,287 NA $7,820 $8,113 $8,688
EBIT: $2,966 $3,225 NA $5,584 $5,793 $6,204
EPS: $4.51 $5.02 NA $4.52 $4.79 $5.75
Wal-Mart Stores, Inc. - Operating Model and Valuation

COST TGT
Costco Wholesale Corporation Target Corporation
Diluted Shares Calculation Diluted Shares Calculation
Current Share Price: $100.73 $63.12
Common Shares: 432.42 668.49
Options:
Total Strike Dilution Total Strike Dilution
1.23 35.95 0.79 38.15 $47.59 9.39
1.70 43.77 0.96 1.55 1.55
0.23 46.19 0.12 1.61 1.61
9.26 9.26 0.00 $0.00 0.00
0.00 $0.00 0.00 0.00 $0.00 0.00
0.00 $0.00 0.00 0.00 $0.00 0.00
0.00 $0.00 0.00 0.00 $0.00 0.00
0.00 $0.00 0.00 0.00 $0.00 0.00
0.00 0.00 $0.00 0.00
Total Diluted Shares: 443.56 681.04

Valuation Metrics Valuation Metrics

Equity Value: $44,680 $42,987

Enterprise Value: $41,365 $59,676
Beta: 0.69 0.92

Valuation Multiples Valuation Multiples

TTM 1/31/2013 1/31/2014 1/31/2015 TTM 1/31/2013 1/31/2014 1/31/2015
TEV / Revenue: 0.4 x 0.4 x 0.4 x N/A 0.9 x 0.8 x 0.8 x 0.7 x
TEV / EBITDA: 11.3 x 10.5 x 9.6 x N/A 8.0 x 7.6 x 7.4 x 6.9 x
TEV / EBIT: 15.0 x 13.9 x 12.8 x N/A 11.2 x 10.7 x 10.3 x 9.6 x
Pro-Forma P/E: 25.3 x 22.3 x 20.1 x N/A 14.7 x 14.0 x 13.2 x 11.0 x

Lookup Variables Lookup Variables

01/31/2013 Revenue: $106,560 $73,301

01/31/2013 EBITDA: $3,942 $7,820
01/31/2013 EBIT: $2,966 $5,584
01/31/2013 EPS: $4.51 $4.52

01/31/2014 Revenue: $115,890 $76,050

01/31/2014 EBITDA: $4,287 $8,113
01/31/2014 EBIT: $3,225 $5,793
01/31/2014 EPS: $5.02 $4.79

01/31/2015 Revenue: NA $81,440

01/31/2015 EBITDA: NA $8,688
01/31/2015 EBIT: NA $6,204
01/31/2015 EPS: NA $5.75

TTM TEV / Revenue: 0.4 x 0.9 x

TTM TEV / EBITDA: 11.3 x 8.0 x
TTM TEV / EBIT: 15.0 x 11.2 x
TTM Pro-Forma P/E: 25.3 x 14.7 x

01/31/2013 TEV / Revenue: 0.4 x 0.8 x

01/31/2013 TEV / EBITDA: 10.5 x 7.6 x
01/31/2013 TEV / EBIT: 13.9 x 10.7 x
01/31/2013 Pro-Forma P/E: 22.3 x 14.0 x

01/31/2014 TEV / Revenue: 0.4 x 0.8 x

01/31/2014 TEV / EBITDA: 9.6 x 7.4 x
01/31/2014 TEV / EBIT: 12.8 x 10.3 x
01/31/2014 Pro-Forma P/E: 20.1 x 13.2 x

01/31/2015 TEV / Revenue: N/A 0.7 x

01/31/2015 TEV / EBITDA: N/A 6.9 x
01/31/2015 TEV / EBIT: N/A 9.6 x
01/31/2015 Pro-Forma P/E: N/A 11.0 x
Wal-Mart Stores, Inc. - Operating Model and Valuation

KSS DG WMT
Kohl's Corporation Dollar General Corp. Wal-Mart Stores, Inc.
Calendarization Calendarization Calendarization
Old Partial New Partial FY TTM Old Partial New Partial FY TTM Old Partial New Partial FY TTM
Revenue: $18,804 $18,804 $14,807 $14,807 $ 446,950 $446,950
COGS: $11,625 $11,625 $10,109 $10,109 335,127 $335,127
Gross Profit: $0 $0 $7,179 $7,179 $0 $0 $4,698 $4,698 $0 $0 $111,823 $111,823
Operating Expenses: $5,021 $5,021 $3,207 $3,207 85,265 $85,265
Other Income / (Expense): ($299) ($299) ($266) ($266) (2,160) ($2,160)
Pre-Tax Income: $0 $0 $1,859 $1,859 $0 $0 $1,225 $1,225 $0 $0 $24,398 $24,398
Taxes: $692 $692 $459 $459 7,944 $7,944
Net Income: $0 $0 $1,167 $1,167 $0 $0 $767 $767 $0 $0 $16,454 $16,454
Amortization: $424 $424 $32 $32 $0 $0
Depreciation: $354 $354 $244 $244 8,130 $8,130
Non-Recurring Charges: $0 $0 $0 $0 $0 $0
Tax Rate: 35% 35% 35%

Net Income: $0 $0 $1,167 $1,167 $0 $0 $767 $767 $0 $0 $16,454 $16,454

EPS: $4.74 $2.23 $4.78

EBITDA: $0 $0 $2,936 $2,936 $0 $0 $1,766 $1,766 $0 $0 $34,688 $34,688

EBIT: $0 $0 $2,158 $2,158 $0 $0 $1,491 $1,491 $0 $0 $26,558 $26,558

Balance Sheet Data Balance Sheet Data Balance Sheet Data

Cash & Cash-Equivalents: $1,358 $126 $6,550
Debt & Capital Leases: $4,244 $2,618 $53,427
Preferred Stock: $0 $0 $0
Noncontrolling Interests: $0 $0 $4,850

Equity Research Projections Equity Research Projections Equity Research Projections

1/31/2013 1/31/2014 1/31/2015 1/31/2013 1/31/2014 1/31/2015 1/31/2013 1/31/2014 1/31/2015
Bank: NA NA NA
Date: 2/27/2013 2/27/2013 2/27/2013
Revenue: $19,220 $19,500 NA $16,080 $17,650 NA $ 471,317 $ 493,709 $ 515,675
EBITDA: $3,001 $3,045 NA $1,918 $2,105 NA 36,827 38,576 40,293
EBIT: $2,206 $2,238 NA $1,619 $1,777 NA 28,272 29,615 30,932
EPS: $4.14 $4.56 NA $2.85 $3.28 NA $5.12 $5.55 $6.03
Wal-Mart Stores, Inc. - Operating Model and Valuation

KSS DG WMT
Kohl's Corporation Dollar General Corp. Wal-Mart Stores, Inc.
Diluted Shares Calculation Diluted Shares Calculation Diluted Shares Calculation
Current Share Price: $46.10 $46.34 $73.26
Common Shares: 243.25 338.09 3,404.54
Options:
Total Strike Dilution Total Strike Dilution Total Strike Dilution
1.45 $29.54 0.52 4.26 $10.55 3.29 20.15 $48.21 6.89
0.12 $37.35 0.02 3.97 $10.75 3.05 30.94 $0.00 30.94
1.85 $41.58 0.18 0.00 $0.00 0.00 0.00 $0.00 0.00
1.48 $43.06 0.10 0.00 $0.00 0.00 0.00 $0.00 0.00
2.18 $48.25 0.00 0.00 $0.00 0.00 0.00 $0.00 0.00
2.15 $51.35 0.00 0.00 $0.00 0.00 0.00 $0.00 0.00
3.65 $57.65 0.00 0.00 $0.00 0.00 0.00 $0.00 0.00
1.24 $68.70 0.00 0.00 $0.00 0.00 0.00 $0.00 0.00
1.95 1.95 0.00 $0.00 0.00 0.00 $0.00 0.00
Total Diluted Shares: 246.02 344.43 3,442.37

Valuation Metrics Valuation Metrics Valuation Metrics

Equity Value: $11,342 $15,961 $252,188

Enterprise Value: $14,228 $18,453 $303,915
Beta: 0.85 0.10 0.36

Valuation Multiples Valuation Multiples Valuation Multiples

TTM 1/31/2013 1/31/2014 1/31/2015 TTM 1/31/2013 1/31/2014 1/31/2015 TTM 1/31/2013 1/31/2014 1/31/2015
TEV / Revenue: 0.8 x 0.7 x 0.7 x N/A 1.2 x 1.1 x 1.0 x N/A 0.7 x 0.6 x 0.6 x 0.6 x
TEV / EBITDA: 4.8 x 4.7 x 4.7 x N/A 10.4 x 9.6 x 8.8 x N/A 8.8 x 8.3 x 7.9 x 7.5 x
TEV / EBIT: 6.6 x 6.5 x 6.4 x N/A 12.4 x 11.4 x 10.4 x N/A 11.4 x 10.7 x 10.3 x 9.8 x
Pro-Forma P/E: 9.7 x 11.1 x 10.1 x N/A 20.8 x 16.3 x 14.1 x N/A 15.3 x 14.3 x 13.2 x 12.1 x

Lookup Variables Lookup Variables Lookup Variables

01/31/2013 Revenue: $19,220 $16,080 $471,317

01/31/2013 EBITDA: $3,001 $1,918 $36,827
01/31/2013 EBIT: $2,206 $1,619 $28,272
01/31/2013 EPS: $4.14 $2.85 $5.12

01/31/2014 Revenue: $19,500 $17,650 $493,709

01/31/2014 EBITDA: $3,045 $2,105 $38,576
01/31/2014 EBIT: $2,238 $1,777 $29,615
01/31/2014 EPS: $4.56 $3.28 $5.55

01/31/2015 Revenue: NA NA $515,675

01/31/2015 EBITDA: NA NA $40,293
01/31/2015 EBIT: NA NA $30,932
01/31/2015 EPS: NA NA $6.03

TTM TEV / Revenue: 0.8 x 1.2 x 0.7 x

TTM TEV / EBITDA: 4.8 x 10.4 x 8.8 x
TTM TEV / EBIT: 6.6 x 12.4 x 11.4 x
TTM Pro-Forma P/E: 9.7 x 20.8 x 15.3 x

01/31/2013 TEV / Revenue: 0.7 x 1.1 x 0.6 x

01/31/2013 TEV / EBITDA: 4.7 x 9.6 x 8.3 x
01/31/2013 TEV / EBIT: 6.5 x 11.4 x 10.7 x
01/31/2013 Pro-Forma P/E: 11.1 x 16.3 x 14.3 x

01/31/2014 TEV / Revenue: 0.7 x 1.0 x 0.6 x

01/31/2014 TEV / EBITDA: 4.7 x 8.8 x 7.9 x
01/31/2014 TEV / EBIT: 6.4 x 10.4 x 10.3 x
01/31/2014 Pro-Forma P/E: 10.1 x 14.1 x 13.2 x

01/31/2015 TEV / Revenue: N/A N/A 0.6 x

01/31/2015 TEV / EBITDA: N/A N/A 7.5 x
01/31/2015 TEV / EBIT: N/A N/A 9.8 x
01/31/2015 Pro-Forma P/E: N/A N/A 12.1 x
Wal-Mart Stores, Inc. - Operating Model and Valuation

Discounted Cash Flow Analysis

($ in Millions, Except per Share Figures)

Wal-Mart Stores, Inc. - DCF Cash Flow Projections Wal-Mart Stores, Inc. - Assumptions & Output

1/31/2013 1/31/2014 1/31/2015 1/31/2016 1/31/2017 Use Multiples Method? No

Revenue: $ 471,317 $ 493,709 $ 515,675 $ 534,773 $ 551,404 Discount Rate: 5.9%

EBITDA: 36,827 38,576 40,293 41,785 43,084
Operating Income: 28,272 29,615 30,932 32,078 33,076 Terminal EBITDA Multiple: 9.0 x
Terminal Growth Rate: 2.0%
Less: Taxes: (9,047) (9,477) (9,898) (10,265) (10,584) Terminal Value: $ 442,330
Implied EBITDA Multiple: 10.3 x
Plus: Depreciation & Amortization: 8,555 8,962 9,360 9,707 10,009
Plus: Goodwill Impairment: - - - - - PV of Terminal Value: 341,064
Plus: Deferred Income Taxes: 916 961 1,007 1,038 1,073 Sum of PV of Cash Flows: 69,667
Change in Working Capital (from CFS): 355 467 372 321 179 Enterprise Value: $ 410,731
Less: Capital Expenditures: (14,217) (14,893) (15,555) (16,132) (16,633)
Terminal Value % EV: 83.0%
Unlevered Free Cash Flow $ 14,834 $ 15,635 $ 16,218 $ 16,748 $ 17,119
Present Value of Free Cash Flow $ 14,411 $ 14,337 $ 14,037 $ 13,682 $ 13,200 Enterprise Value: $ 410,731
Plus: Cash & Cash Equivalents: 6,550
Projection Year: 0.000 1.000 2.000 3.000 4.000 5.000 Plus: Equity Interests: –
Normal Mid-Year Convention Discount: 0.500 1.500 2.500 3.500 4.500 Less: Debt & Capital Leases: (53,427)
Less: Preferred Stock: –
Free Cash Flow Growth Rate: 5.4 % 3.7 % 3.3 % 2.2 % Less: Noncontrolling Interests: (4,850)
Implied Equity Value: $ 359,004
Wal-Mart Stores, Inc. - Net Present Value Sensitivity - Terminal Growth Rates
Discount Rate Diluted Shares Outstanding: 3,474
$103.34 4.5% 5.0% 5.5% 6.0% 6.5% 7.0% 7.5% 8.0% Implied Share Price: $ 103.34
2.8% $ 243.20 $ 186.29 $ 150.07 $ 125.00 $ 106.61 $ 92.55 $ 81.45 $ 72.46
Terminal Growth

2.3% $ 189.56 $ 152.72 $ 127.21 $ 108.51 $ 94.21 $ 82.92 $ 73.78 $ 66.23

1.8% $ 155.42 $ 129.48 $ 110.45 $ 95.90 $ 84.42 $ 75.12 $ 67.44 $ 60.99
Rate

1.3% $ 131.79 $ 112.44 $ 97.64 $ 85.95 $ 76.49 $ 68.68 $ 62.12 $ 56.53

0.7% $ 114.46 $ 99.40 $ 87.52 $ 77.89 $ 69.95 $ 63.27 $ 57.58 $ 52.68
0.2% $ 101.21 $ 89.11 $ 79.32 $ 71.24 $ 64.45 $ 58.66 $ 53.67 $ 49.33

Wal-Mart Stores, Inc. - Net Present Value Sensitivity - Terminal EBITDA Multiples
Discount Rate
$103.34 4.5% 5.0% 5.5% 6.0% 6.5% 7.0% 7.5% 8.0%
11.0 x $ 170.78 $ 140.13 $ 118.24 $ 101.81 $ 89.04 $ 78.82 $ 70.47 $ 63.50
Terminal EBITDA

10.0 x $ 170.78 $ 140.13 $ 118.24 $ 101.81 $ 89.04 $ 78.82 $ 70.47 $ 63.50

Multiple

9.0 x $ 170.78 $ 140.13 $ 118.24 $ 101.81 $ 89.04 $ 78.82 $ 70.47 $ 63.50

8.0 x $ 170.78 $ 140.13 $ 118.24 $ 101.81 $ 89.04 $ 78.82 $ 70.47 $ 63.50
7.0 x $ 170.78 $ 140.13 $ 118.24 $ 101.81 $ 89.04 $ 78.82 $ 70.47 $ 63.50
6.0 x $ 170.78 $ 140.13 $ 118.24 $ 101.81 $ 89.04 $ 78.82 $ 70.47 $ 63.50
Wal-Mart Stores, Inc. - Operating Model and Valuation

Discount Rate Calculations

($ in Millions, Except per Share Figures)

Discount Rate Calculation - Assumptions

Risk-Free Rate: 2.72%
Equity Risk Premium: 5.00%
Interest Rate on Debt: 4.50%

Comparable Companies - Unlevered Beta Calculation

Levered Equity Unlevered
Name Ticker Beta Debt Value Tax Rate Beta
Costco Wholesale Corporation COST 0.69 $ 1,382 $ 44,680 35% 0.68
Target Corporation TGT 0.92 17,483 42,987 35% 0.73
Kohl's Corporation KSS 0.85 4,244 11,342 35% 0.68
Dollar General Corp. DG 0.10 2,618 15,961 35% 0.09

Median 0.68

Wal-Mart Stores, Inc. WMT 0.36

Wal-Mart Stores, Inc. - Levered Beta & WACC Calculation

Unlevered Equity Levered
Ticker Beta Debt Value Tax Rate Beta

Wal-Mart Stores, Inc. WMT 0.68 $ 53,427 $ 252,188 35% 0.77

Cost of Equity Based on Comparables: 6.59%

Cost of Equity Based on Historical Beta: 4.52%

WACC = Cost of Equity * % Equity + Cost of Debt * % Debt * (1 - Tax Rate) + Cost of Preferred Stock * % Preferred Stock

WACC 5.95%