Why We Sold Walmart - It’s Not Why You Think


Walmart’s stock price took a bath early last week, and there are a lot of opinions regarding where the stock price now sits. The catalyst was their 4th quarter and fiscal year-end 2018 annual report (note: Walmart has a January 31 fiscal year end). The following headlines courtesy of “Google Finance” illustrate the variance of opinions referenced above:

Walmart Financial Headlines Week of February 19, 2018:

U.S. News & World Report – Feb 20, 2018 Walmart Earnings Are a Huge Disappointment

Nasdaq – 20 hours ago – Walmart Inc Stock Is a Hot Bargain After Post-Earnings Drop

SFGate – Feb 20, 2018 – Walmart’s bruising battle with Amazon saps its 4Q results

Seeking Alpha – 6 hours ago Walmart Stock Looks Due For Further Weakness

Forbes – Feb 21, 2018 4 Reasons To Buy Walmart After 10% Plunge

As you can see (from the above), investors reacted both positively and negatively towards the company’s financial release. I personally reviewed the company’s financial reports and drew mixed conclusions. The following “Situation Report” courtesy of S&P Capital IQ provides a synopsis of Walmart’s recent financial statements. I have color-coded each segment according to whether I saw it as positive (green) or negative (red) and if I saw it as neutral I highlighted it in yellow. Therefore, a quick scan of the colors alone clearly illustrate that there were both positive aspects and negative aspects regarding what Walmart reported.

“Situation(courtesy of S&P Capital IQ):

Wal-Mart Stores Inc. reported unaudited consolidated earnings results for the fourth quarter and year ended January 31, 2018.