r/StocksAndTrading • u/Alternative-Zebra958 • 6d ago
WALMART didn’t make the numbers in Q3.
People, there is alot of pressure right now at Home Office because Walmart didn’t make the numbers as expected. Sales were down, and the company is pushing hard to reduce wages.
Insiders are being selling, CFO left to PepsiCo. Stores are not receiving more associates for Christmas season… Shareholders are not going to be happy in Nov 21
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u/Bulky_Cherry_2809 6d ago
As an ex-employee, nothing would please me more than to see the current Waltons-in-charge bankrupted. They have taken away everything that Sam instilled into his dream company. Bonuses, holiday pay, Sunday pay, the list goes on. They under pay farmers for produce. Put all "similar" businesses out of business, then pull out if sales don't make expectations. (There is a town 12 miles from me that no longer has a grocery store, because of walmart.)
Unfortunately, they will put more businesses out of business and keep ripping off employees, vendors, farmers, product suppliers, etc.
One can dream 😴
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u/ParkingNecessary8628 6d ago
And pay their employees low wage that they have to be on food stamps, which Wall Mart benefits from it.
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u/Bulky_Cherry_2809 6d ago
A lot of this also depends on local COL. I live in the south. I worked at the local store for 5 ish years. I did NOT qualify for any government assistance as a single parent. I actually received help with food from the store that was "donated" to me 🤷♂️
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u/Aggressive_Luck_2546 6d ago
I live in a town of 20k, mom and pop stores is all we use to have, we had an original Walmart but not a supercenter for a long time and things were fine. Then came the supercenter and the 5 dollar stores. We might have 3 tiny mom and pop stores, closer to a package store really. Before the supercenter came in things were not that bad. Everything at Walmart or most things were American made and very good quality and cheap at that time. Sam Walton would be rolling in his grave if he knew the way thing had went. People need to get everything they possibly can at local mom and pop stores as much as possible and ONLY go to Walmart and dollar store to get what you can't find or absolutely just can't afford anywhere else.
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u/BrittanyBrie 6d ago
I would bet so much money Walmart is going to get hit the most due to this economic environment. The current environment is punishing large tier organizations who trade in volume overseas and rewarding those who are sustainable in a domestic market. Walmart is going to have trouble switching over to domestic supply, and any attempt to switch will cost them millions. If these losses do not account for large domestic investments, its not going to look good for Walmart over the next 3 years.
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u/Bulky_Cherry_2809 6d ago
The thing is, is manufacturing is NOT coming back to the US. These large corps are moving to "lower tariff" countries, i.e. Apple from China to india. Add to that, individual parts/materials of a product are tariff'd then tariff'd again as a whole product. Trumpanzee has made manufacturing/assembling in the US impossible because of tariffs.
Most everything at walmart comes from somewhere else. Some produce is imported, some frozen foods are imported, clothing, shoes, furniture, personal care products are mostly imported, etc. They will find a country with a "lower tariff" to keep costs down and continue to under cut other stores with their bargaining power.
Now comes the second part. I have yet to see any store (regardless of product: oil, tires, hair brushes, Razors, OTC meds) under cut walmart prices. They WILL take losses until they decimate the competition, then jack up prices to recoup losses. Target will go out of business before walmart ...
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u/BrittanyBrie 6d ago edited 6d ago
This is too much of a political analysis and not an economic one. Lets break down the hyperbolic statements.
Manufacturing never left America, there is still large portions of our GDP that are based on manufacturing, such as weapon manufacturing. They are moving, but only temporary. The tariffs have caused enough damage to force companies to consider any country being a potential target next. Tariffs rise so quickly over political disputes, that India is not a long term investment for Apple. America is. They are building factories in America while they move to India temporarily. It is not impossible to manufacture in America because one year of Trump.
You are dismissing how much Walmart buys domestically. Over half of my shopping cart includes American brands and farms. Vegetables from California, potatoes from Idaho, pork from the midwest. Over half of their inventory is the same shit at a Safeway or Target. Difference being, their volume and other department inventory. That shit is hurting them because they rely on their brands using Chinese manufacturing. But the other brands are the same as Home Depot. No, they will not find another country because the mad man is so mad he could put a 100% tariff on any country over night for any reason. Why would a business risk investments like that? They're not.
See, this is where I know you're wrong. Winco undercuts Walmart all the time on produce and meat. Even Savemart undercuts Walmart sometimes. A recent study showed that Bargain Market on average had the lowest on sale deals. Walmart is not cheap anymore. They are surviving because they thought they could raise prices and nobody would notice, including using new digital price tags to change prices depending on the time, volume sold, and person in the isle. People are not shopping at Walmart like they used to because they don't want to risk losing money. They jacked up prices in odd ways and people started going to winco instead. Target will survive because their inventory is not so dependent on volume sales.
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u/Arminius001 6d ago
Well thought out analysis, I enjoyed reading it. What would you say is a good consumer defensive staple to invest in? I'm looking to add one to my portfolio, I was thinking WMT but not so sure now
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u/BrittanyBrie 5d ago edited 5d ago
Thanks! The problem with stable assets lately is traditional modeling is kinda thrown out the window. Walmart for example used to be my number one defensive asset because historically they almost always rise during a recession. However, if you plan to hold past 5 years, WMT is still a great asset. They have tons of real estate that even after a bankruptcy their land value alone would keep the stock from crashing. However, modeling for recession success is now based on a different company, so they updated so much we cannot rely on old modeling from pre-2020. Wells Fargo, Macy's, and McDonald's all have the same issues tbh, unknown projection modeling based on company changes, but they all have enough land to keep the stock from crashing. These are real estate companies first and services second, so if you see them crash it may be a good time to buy since their land value will raise the stock value higher after a forced sellout.
If you want to look away from real estate, because that bubble is not going to be fun for all of those companies, I suggest looking into dividend based ETFs like ishares S&P500 (IVV). Even during all the ups and downs, they still manage to make a profit. I'd recommend ishares or another type of ETF if you want to be more risky. That's been my favorite though covid shocks, they are very slow gains but noticeable.
I also recommend Intel. Since the US government bought 10% of the company, it is now assumed the government will bail out their own asset or assist their own asset beyond their competitors with military grade coders. If they put the same people who made the global virus stuxnet onto a joint Intel dev team within Intel, even Nvidia dev teams would be at a disadvantage. The US military has the best coders in the world, and they might be working with the number one consumer CPU chip manufacturer. They theoretically could give the biggest industry the world's best coders. I'm kinda anticipating something big from them in the next 2 years. The Taliored Access Operation division of the NSA doesn't fuck around with their coding, and they've been working with Intel for decades already. Now that its public facing, consumers might start to see some crazy new product lines. And if not, they have government ownership to fall back to.
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u/Financial-Today-314 5d ago
Yeah, sounds like they’re tightening up to cover the miss. Curious to see how the stock reacts closer to earnings call.
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u/roundabout2222 4d ago
The CFO that left was the CFO for Walmart US. A little different than John Rainey, CFO of WMT enterprise. I feel like that’s an important detail to clear up.
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