Wal-Mart Forecast Trails Estimates as Sales Gains Slow |
| Businessweek - Nov 15, 2012 |
Wal-Mart Stores Inc. (WMT), the world’s largest retailer, forecast fourth-quarter profit that trailed analysts’ estimates in anticipation of a competitive holiday season and after economic conditions slowed U.S. sales gains. The shares fell.
Fourth-quarter profit will be $1.53 to $1.58 a share, the Bentonville, Arkansas-based company said in a statement. The average estimate of analysts surveyed by Bloomberg was $1.59.
Chief Executive Officer Mike Duke has been reducing prices to lure U.S. shoppers that are still suffering amid sluggish economic growth and 7.9 percent unemployment. Discount chains such as Dollar General Corp. (DG) and Dollar Tree Inc. (DLTR) have attracted some of those customers with smaller-format stores that allow for quicker trips and by adding food items.
“The low-end consumer is trying to figure out the dollars they truly have to spend” and that’s been hurting Wal-Mart’s sales, David Strasser, an analyst for Janney Montgomery Scott LLC in New York, said in an interview before the results were released. The expansion by dollar stores has also made capturing price-conscious shoppers more competitive, said Strasser, who recommends buying the shares.
Read Full Article from Businessweek
- Posted: 2012-11-15 12:35:01
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