Why Is Wal-Mart Doing So Well?


	Why Is Wal-Mart Doing So Well?

Tina Russo

2-29-2008 8:45 AM

1047 views

tags:

wal-mart, wmt, retailers, economy, s&p

Tina Russo says:

Retailers are still licking their wounds from a disappointing holiday season and worries of a recession still persist. So why is Wal-Mart thriving? Daniel Gross points to four reasons.

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<div style="margin: 12px 0px; font-family: arial; color: #333333; background: #ffffff; border: solid 4px #e5e5e5; width: 100%; clear: left;"><div class="CM_CTB_Content_Wrap" style="margin: 0px; padding: 0px;background-color: #ffffff;"><div style="border-bottom: solid 1px #dcdcdc; white-space: nowrap; margin-bottom: 8px; background-color: #eeeeee ;background-image: url(http://clipmarks.com/images/source-bg.gif); background-repeat: repeat-x; height: 24px; line-height: 24px; vertical-align: middle; padding-bottom: 4px; color: #666666; font-size: 10px;" ><a href="http://clipmarks.com/clip-to-blog/" title="see clips that are hot right now"><img src="http://content.clipmarks.com/blog_embed/e6ebc642-81ea-454f-b085-f40f45c2d582/1CB4BE27-6F8B-4BC2-9FC6-37D9C3E5035E/" alt="" width="19" height="19" border="0" style="vertical-align: middle; margin: 0px 4px; display: inline; border: none; float:none;" /></a>clipped from <a title="http://www.slate.com/id/2185221/" href="http://www.slate.com/id/2185221/" style="font-size: 11px;">www.slate.com</a></div><blockquote style="text-align: left; padding: 0px 8px; margin: 4px 0px 8px 0px; background: transparent; border: none;" cite="http://www.slate.com/id/2185221/">Given the economic headwinds, one would think that a retailer catering to lower-end consumers would be doubly slammed. As the subprime-mortage mess shows, people at the bottom of the income ladder are struggling. And as for the retail sector generally, don't ask. Retail sales have been <A target="_blank" href="http://www.census.gov/svsd/www/marts_current.html">sluggish in recent months</A>, and national chains are <A href="http://www.slate.com/id/2184492/">shutting down stores by the dozen</A>.</blockquote><div style="height: 2px; font-size: 2px; background: #dcdcdc; border-bottom: solid 1px #f5f5f5; margin: 2px 4px;"></div><blockquote style="text-align: left; padding: 0px 8px; margin: 4px 0px 8px 0px; background: transparent; border: none;" cite="http://www.slate.com/id/2185221/">Which brings us to the mystery of Wal-Mart. The nation's largest retailer, which caters to working-class customers, seems to have something of a sweet spot. The <A target="_blank" href="http://finance.yahoo.com/q?s=wmt">stock</A> closed Tuesday at $51.40—its highest close since March 2005. Amid the market turbulence of the last six months, Wal-Mart's stock has risen nicely and has <A target="_blank" href="http://finance.yahoo.com/q/bc?t=6m&s=WMT&l=on&z=m&q=l&c=%5Erlx">pasted</A> the Standard & Poor's retail index. Wal-Mart's stock makes an excellent proxy for the health of the working-class consumer. So how can it be that Wal-Mart's stock is outperforming its tonier, trendier rivals?</blockquote></div><div style="margin: 0px 6px 6px 4px;"><table style="font-size: 11px;border-spacing: 0px;padding: 0px;" cellpadding="0" cellspacing="0" width="100%"><tr><td style="background:transparent;border-width:0px;padding:0px;">&nbsp;</td><td align="right" style="background:transparent;border-width:0px;padding:0px;width:107px" width="107"><a href="http://clipmarks.com/share/1CB4BE27-6F8B-4BC2-9FC6-37D9C3E5035E/blog/" title="blog or email this clip"><img src="http://content7.clipmarks.com/images/c2b-foot.png" border="0" alt="blog it" width="107" height="17" style="border-width:0px;padding:0px;margin:0px;" /></a></td></tr></table></div></div>

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