Home » Bear Case Scenario » Bear Case Scenario Wal-Mart $WMT, $M, $COST, $TGT, $DG, $DDS, $JCP, $SHLD

Bear Case Scenario Wal-Mart $WMT, $M, $COST, $TGT, $DG, $DDS, $JCP, $SHLD

Wal-Mart (NYSE:WMT) is about to release earnings. Ponder the Bear Case Scenario:

Revenues are down because Food Stamps have been cut back. Give me a break. This business is depending on welfare to maintain core earnings. Management had the unmitigated gall to claim surprise over the amount if the drop. Buddy modern retail can track sales by category to the minute. They must have been asleep.

E-Commerce is new and wondrous to Wal-Mart. They do not have experience. Extreme price competition or destroying down town cores of small town America do not work the same way on the internet.

Wal-Mart means cheap. 10% of Americas retail dollar ex auto goes through Wal-Mart. They have reached the natural limits of their models growth.

Wal-Mart bullies their suppliers. What if suppliers revolt like the revolt of gladiators or slaves in olde empires that pushed their limits too far. What if Coca Cola and Pepsi say screw it you’re hurting our sales everywhere.  I’m waiting for the brand to say not available at Wal-Mart. Lots of social awareness affinity available to those brands who can figure it out.

George Gutowski writes from a caveat emptor perspective.