Wal-Mart Stores, Inc. (WMT) Earnings on Thursday: A Buy Before, After or Never?

Wal-Mart Stores, Inc. (NYSE:WMT) will be declaring its second quarter earnings on Thursday and as usual the Street is expecting nothing spectacular from the company, though most believe that Wal-Mart Stores, Inc. (NYSE:WMT) will yet again disappoint. The company it seems has reached a saturation point from where it hasn’t been able to pull itself out since over a decade. Wal-Mart Stores, Inc. (NYSE:WMT) tried expanding to other countries, but all its attempts have been mostly unsuccessful. Should an investor put his money in Wal-Mart Stores, Inc.(NYSE:WMT)’s stocks before its earnings or is it better suited elsewhere?

That and the leadership of the company was the topic of discussion between Chad Morganlander from Stifel and Burt Flickinger from Strategic Resource Insight Group, on CNBC recently.

“In the long term, going at 3 to 5 years, we believe that this valuation makes sense, P/E multiple is trading at roughly at about 14 and a half times 2014, 13 and a half times 2015, trading at 11 times free cash flow. Expectations are washed out, revenue growth exceeds over 3%, then you can see the stock higher. Revenue growth of about 3 to 5% over the next would put this stock perhaps at a total return of around 8%, over the course of that time period,” Morganlander said.

Wal-Mart Stores, Inc. (WMT)

Burt Flickinger is of the view that Wal-Mart Stores, Inc. (NYSE:WMT) is really struggling with its international expansions, as is evident from the company’s recent struggles in Africa, South America and Asia. Flickinger also believes that Wal-Mart Stores, Inc. (NYSE:WMT)’s cash flow is good, but the company is in a ‘value trap’ because Wal-Mart Stores, Inc. (NYSE:WMT) doesn’t have a great leadership to execute its international expansions successfully. He also gave advice to investors that they should run away from retail stocks except those companies that sell luxury products or category specific products.

“[...] The quarterly numbers will come out, they probably will be below expectations, the stock would probably trade down 3 to 5%, but that will probably be a good time for investors to take a position in the company,” Morganlander added.

Disclosure: None

Comments
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months. Our beta is only 1.2 (don't click this link if beating the market isn't important to you).

Lists

The 10 Largest Pharmaceutical Companies In the World

The 10 Most Expensive Android Apps

The 9 Most Expensive Designer Bags in the World

The 7 Most Expensive Real Estate in the World

The 10 Most Expensive eBay Items Ever Sold

The 10 Most Expensive iPhone Apps

The 9 Most Expensive Designer Shoes in the World

The 10 Most Expensive Cigarette Brands

The 10 Most Expensive Law Schools in the US

The 10 Best Wall Street Movies

The 10 Most Expensive Golf Clubs Ever Sold

The 10 Most Expensive Golf Memberships

The 10 Best Disney Characters Ever Created

The 8 Best Foods for Gaining Weight

The 10 Most Expensive Colleges in the World

The 7 Most Memorable Ad Campaigns of All Time

The 7 Most Expensive High Schools in the World

The 10 Electric Vehicles with the Longest Range

The 10 Cities with the Worst Drivers in the World

The 10 Most Expensive Dresses Ever Created

10 Islands to Visit Before You Die

10 Famous Celebrities Who Needed Rehab

The 15 Countries with the Largest Oil Reserves

The 10 Most Overused Excuses in the World

The 5 Best iOS Apps You Can’t Get on Android

5 Companies Damaged By Social Media Blunders

The 10 Most Legendary Blues Songs

The 10 Most Lawless Places in the World

4 Reasons China is a Threat to the US

The 17 Most Sugary Drinks in the World

The 10 Most Ruthless Rulers in History

The 10 Greatest Generals in History

Top 8 Travel Destinations for 2015

The 10 Safest Dog Breeds for Children

The 10 Most Stolen Vehicles in the US

The 7 Most Expensive Celebrity Weddings

The 10 Best LoL Teams in the World

Top 10 Worst Marketing Campaigns Ever Produced

Top 5 Diets that Help You Lose Weight

The 10 Best Ways to Stay Awake

7 Artists That Switched Musical Genres

The 10 Most Expensive Cities to Live in New Jersey

The 10 Best High Schools in New York

The 10 Countries With the Least Gender Inequality

The 6 Biggest Musician-Manager Feuds

The 10 Countries with the Cheapest Gas Prices

The 7 Most Theatrical Bands of All Time

The 8 Worst Band Breakups of All Time

The 10 Most Important South American Leaders

The 7 Most Successful Casting Show Winners

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!