3 Walton heirs sell $4B in shares

Transaction helps keep family’s stake in company at 50%

This undated file photo shows Walmart's sign in front of its Bentonville headquarters.

Three heirs of Walmart Inc. founder Sam Walton have sold a combined 28.6 million shares, worth roughly $4 billion, in the company in the first half of this year, government filings show.

The statements were filed with the Securities and Exchange Commission between January and June on behalf of Sam Walton's children Rob Walton, Jim Walton and Alice Walton. The stock was sold in multiple trades, according to the documents, with prices at the time of the sales ranging from about $136 to $143 per share.

The Walton Family Holdings Trust, formed in 2015 to hold the family's shares, sells some periodically to keep the family's ownership in Walmart at about 50% and to fund charitable contributions.

The family owns roughly half of the company's outstanding shares through the trust and Walton Enterprises LLC, which handles the family's investments.

Walmart shares closed Thursday at $139.32, down $1.70, or 1.21%, on the New York Stock Exchange.

Besides Sam Walton's three surviving children, the family includes the widow and son of the late John Walton and the two daughters of Sam Walton's brother, Bud Walton.

The seven Walton heirs are collectively worth $231.9 billion, according to Forbes' Real-Time Billionaires list Thursday, making them the world's richest family.

Brian Yarbrough, a retail analyst with financial services firm Edward Jones, said Thursday that the family's 50% ownership stake in Walmart is just their preference.

"I don't think there's any significance beyond that's what the family's comfortable with, and that's what they feel like is the appropriate ownership," he said. "It doesn't have to be exactly 50% but right around there."

Yarbrough said the reason they've been selling stock is that Walmart has been buying back stock. As it does, those shares get retired. "That pushes the overall share count down, which means the Waltons' stake goes up," he said.

Companies use buyback programs to increase earnings per share without increasing revenue. They view this as a method of returning value to shareholders.

Walmart didn't do any buybacks last year during the pandemic, Yarbrough said, so there wasn't much reason for the Walton family to sell shares.

"But with Walmart doing so well last year and generating so much cash, now [Walmart is] starting to buy back shares again," Yarbrough said. "I would expect they'll continue to be somewhat aggressive in share repurchases."

The Walton family may be done with selling shares for the year, Yarbrough said, "but I would assume this will be something that continues to occur over the coming years as the family continues to keep their stake around 50%."