Dive Summary:
- A number of retail stocks dropped last week following leaked e-mails from Walmart executives, including one in which Jerry Murray referred to the company's February sales thus far as a "total disaster."
- The sentiment seemed to confirm fears that low-end consumers would be hit hard by a 2% payroll tax that went into effect at the beginning of the year, though Walmart CEO Bill Simon blamed February's slow start on delayed income-tax return checks Thursday.
- In the current environment, Target, CostCo, Safeway, Dollar General, Advance Auto Parts and Amazon all stand a chance of outperforming Walmart for a variety of reasons.
From the article:
... Walmart is the nation's largest retailer, and as such its results can tell us a lot about the health of the economy. On the other hand, Walmart relies heavily on down-market consumers. These shoppers have less disposable income and as such to be more sensitive things like the payroll-tax increase or rising gas prices. This mean Walmart may be more sensitive to some events than other retailers. ...
