Looks Like Walmart is Hurting... Wonder Why?

Discussion in 'Current Events' started by 007, Nov 27, 2006.

  1. 007
    Offline

    007 Charter Member Supporting Member

    Joined:
    May 8, 2004
    Messages:
    38,328
    Thanks Received:
    7,868
    Trophy Points:
    1,130
    Ratings:
    +11,946
    Breaking News

    Wal-Mart Trends Weakest in a Decade

    NEW YORK -(Dow Jones)- Wal-Mart Stores Inc. (WMT), on track to report disappointing sales for November, is now under increased pressure to deliver a strong finish to the holidays.

    The Bentonville, Ark., retailer said Saturday it expects a 0.1% decline in its November same-store sales, or sales at stores open at least a year, a closely watched measure of a retailer's performance. That would mark the first such monthly decline for Wal-Mart since April 1996, when a shift in the timing of the Easter holiday helped fuel a 0.6% drop.

    Wal-Mart's Saturday outlook falls short of its earlier forecast for flat same-store sales in November, and will add to Wal-Mart's difficulty as it struggles to meet its previous forecast for a 1% to 2% same-store sales increase for the fourth quarter. To make the number, Wal-Mart will have to post a December increase of at least 2%, Goldman Sachs' Adrienne Shapira noted.

    "The bottom line is that now more is resting on December's shoulders," Shapira wrote in a research note.

    Wal-Mart shares on the New York Stock Exchange recently were at $46.81, off $1.09, or 2.3%, from the close of regular trading on Friday. Volume was more than 12.7 million shares, versus average daily volume of about 15.2 million.

    On the bright side, Wal-Mart faces easier comparisons with December 2005, when same-store sales rose just 2.2% versus the 4.3% gain posted in November 2005. In fact, Wal-Mart's flat performance in November implies that it's on track to deliver the December increase that's needed to meet its fourth-quarter sales view, according to analysis by Merrill Lynch & Co.

    Still, Wal-Mart of late has delivered more disappointments than positive surprises this fall. In October, the company's same-store sales rose just 0.5%, short of an initial forecast for 2% to 4% growth.

    "December is no lay-up for the big discounters," Merrill Lynch analyst Virginia Genereux wrote in a Monday research note, noting that many shoppers have been flocking to consumer-electronics chains. "Wal-Mart may run out of key items by Christmas, as it did last year, and apparel is likely to remain challenging."

    Indeed, things didn't go altogether smoothly for Wal-Mart on the day after Thanksgiving, known as "Black Friday" among retailers for the profits they aim to rack up as they ring in the holiday season. The retailer's Walmart.com Web site shut down intermittently throughout the morning and afternoon amid heavy shopper traffic.

    Wal-Mart for weeks had fiercely hyped its Black Friday discounts, which included a 42-inch plasma TV, which it was selling for less than $1,000. Leading up to Black Friday, Wal-Mart since mid-October also had staged an aggressive publicity campaign, which every week or so announced a new round of discounts on toys, electronics, appliances and food. Deborah Weinswig, an analyst at Citigroup Inc., adds that Wal-Mart's recent rollout of 30-day generic drug prescriptions for $4 should have boosted traffic.

    In reality, it's not clear that Wal-Mart's discounts are any deeper or more widespread than they were a year ago. Last year, for example, Wal-Mart had offered a 42-inch plasma TV for under $1,000, and also had touted price cuts on more than 10,000 items - the same number of items as this year. In an interview last week, Wal-Mart Chief Marketing Officer John Fleming stopped short of saying Wal-Mart's overall discounting really is deeper.

    "We wanted to reaffirm our price perception," Fleming said. "We've put more resources against the messaging to bring that to the attention of customers."

    Store-remodeling efforts that hampered sales in October continued through the first half of the month, and newly remodeled stores didn't appear to boost sales during the latter weeks as much as the company had hoped. Meanwhile, results continue to be hurt by a botched apparel strategy this fall that tried to push overly trendy fashions on Wal-Mart's Middle-American clientele.

    Wal-Mart's stagnant sales have been particularly surprising in light of the recent drop in gasoline prices, said Bill Dreher, an analyst at Deutsche Bank Securities Inc. in New York. With prices at the pump off more than 25% from late-summer levels, many on Wall Street had expected that lower-income customers would begin to loosen their wallets by now.

    Gasoline prices recently have stabilized and shown a slight uptick versus a year ago, when prices fell after a hurricane-driven spike in early fall 2005, Dreher said in a Sunday research note.

    "Now that the heaviest period of hurricane activity last year has been cycled, we are hoping to see some lift to lower-income consumer spending patterns," Dreher said.

    - By James Covert, Dow Jones Newswires; 201-938-5360; james.covert@dowjones.com


    http://www.smartmoney.com/bn/ON/index.cfm?story=ON-20061127-000411-1301
     
  2. 90K
    Offline

    90K BANNED

    Joined:
    Oct 23, 2006
    Messages:
    1,204
    Thanks Received:
    64
    Trophy Points:
    0
    Location:
    in the back of GW in foggy bottom
    Ratings:
    +64
    You know last year Wal-mart was doing the same thing on these extra special sales and baited everyone on those stupid lap tops. But I think people are tired of only having like a 1/2 dozen lap tops or 2 flat screens when you've been dumb enough to wait outside for 6 hours. Not to mention I believe that there are several anti wal-mart interest groups that are about wrecking the stores creditability they have and if that ain't enough with stores literary world wide they could effectively leave the US market in time.
     
  3. red states rule
    Offline

    red states rule Senior Member

    Joined:
    May 30, 2006
    Messages:
    16,011
    Thanks Received:
    571
    Trophy Points:
    48
    Ratings:
    +572


    I would not bury Wal Mart yet. Please consider one little fact - gift cards

    When people buy a gift card they are not counted as a sale until they are used.

    The biggest shopping day is usually the Sat before Christmas
     
  4. jillian
    Offline

    jillian Princess Supporting Member

    Joined:
    Apr 4, 2006
    Messages:
    69,552
    Thanks Received:
    13,012
    Trophy Points:
    2,220
    Location:
    The Other Side of Paradise
    Ratings:
    +22,428
  5. dilloduck
    Offline

    dilloduck Diamond Member

    Joined:
    May 8, 2004
    Messages:
    53,240
    Thanks Received:
    5,552
    Trophy Points:
    1,850
    Location:
    Austin, TX
    Ratings:
    +6,403
    I think Wal-Mart will do quite well in spite of your eagerness to see it go under.
     
  6. rtwngAvngr
    Offline

    rtwngAvngr Guest

    Joined:
    Jan 5, 2004
    Messages:
    15,755
    Thanks Received:
    511
    Trophy Points:
    48
    Ratings:
    +511
    Embargo China!

    Say no to slave labor.

    Evil isn't cool, kiddies.
     
  7. red states rule
    Offline

    red states rule Senior Member

    Joined:
    May 30, 2006
    Messages:
    16,011
    Thanks Received:
    571
    Trophy Points:
    48
    Ratings:
    +572
    From your article jilly:

    The NRF noted that most retailers do not count the gift card as a purchase at the time of sale; rather, they wait until the gift card is redeemed and merchandise is purchased. Because of this, some of the $24.81 billion spent on the cards will not be seen until after the holiday season.



    Why not admit the real reason libs hate Wal Mart? They will not let unions in their stores.

    Unions will rape their workers out of some their money (union dues) and in turn give huge sums to the Dems in the form of donations

    Like with the tobacco companies, Dems see a cash cow and cannot wait to get their hands on the money
     
  8. dilloduck
    Offline

    dilloduck Diamond Member

    Joined:
    May 8, 2004
    Messages:
    53,240
    Thanks Received:
    5,552
    Trophy Points:
    1,850
    Location:
    Austin, TX
    Ratings:
    +6,403
    Maybe you should start an "Embargo China" thread and run with it. Just a thought.
     
  9. red states rule
    Offline

    red states rule Senior Member

    Joined:
    May 30, 2006
    Messages:
    16,011
    Thanks Received:
    571
    Trophy Points:
    48
    Ratings:
    +572


    Still waiting for RWA to tell us how many items he has in his home that are made in China

    Some people will never understand Economics 101 or how capitalism works.
     
  10. rtwngAvngr
    Offline

    rtwngAvngr Guest

    Joined:
    Jan 5, 2004
    Messages:
    15,755
    Thanks Received:
    511
    Trophy Points:
    48
    Ratings:
    +511

    Why don't you kiss my ass, old man? :cool:
     

Share This Page