When it comes to paying dividends, this year had been a draw between the two companies. TGT pays a yield-to-current-price of 2.3%, which represents a payout ratio of only 28%. WMT's yield is currently around 2.21% based on a share price of $72. That represents a slightly higher 32% payout ratio. Jim Cramer's Protégé, Dave Peltier, finds you Stocks Under $10 picks with explosive upside potential. See what he's trading today with a 14-day FREE pass. Now let's compare the very important trailing 12-month operating margin. WMT's weighs in with a 5.94% operating margin. Not too shabby! TGT, though, has an operating margin of 7.43%. At first glance that doesn't seem significant, but it points to the fact that TGT's operating margin is a whopping 25% higher than Wal-Mart's. That's a meaningful difference. Yet when you look at the very important Cash from Quarterly Operations, WMT is the first-prize winner! To illustrate this, take a gander at the chart below. WMT's overhead and cost of doing business is more sizeable than TGT's, but as the chart demonstrates, WMT's Operating Cash is almost 6 times greater! WMT Cash from Operations Quarterly data by YCharts
So in which of these two shining stars in the "big box retailing" constellation should we be investing? The simple answer from my perspective is "both." They are both "best in breed", yet one "pony" just happens to be much bigger than the other.