Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

Wal-Mart Stores, Inc. (WMT), Target Corporation (TGT): Sell these Three Companies Before a Drop

Page 1 of 2

As the North American economy recovers, companies such as Dollarama, Wal-Mart Stores, Inc. (NYSE:WMT), and Target Corporation (NYSE:TGT) will likely have a hard time raking in the profits to which they were accustomed during the recession.

Wal-Mart Stores, Inc. (NYSE:WMT)

Dollarama earnings fall

On June 12 Dollarama reported its fiscal first quarter earnings, which were off of analyst predictions for the first time since the firm’s IPO in October 2009. The median estimate was for the company to come out with earnings per share of CAD $0.67, but the company reported CAD $0.62. In the 14 previous quarters, the Canadian company beat analyst expectations.

According to Edward Jones & Co. analyst Bobby Hagedorn, increased expenses were the main reason for the sour performance. “It was a disappointing quarter. The biggest surprise for us was the operating costs, which were way higher than what we expected,” he told Bloomberg. “They attributed it to costs from the increased pace of store openings.”

The previous steady growth for the company was a sign of the times, with profits soaring as a new class that was hard-hit by the recession poured into stores looking for deals. But now that those people are in more solid financial positions, Dollarama isn’t likely to see the type of profits it had in recent years. The company opened 21 stores in the first quarter, and 85 stores in the last year. These outlets cost a lot of money to set up and train staff, so expect Dollarama’s earnings to be down for at least the next three quarters, despite what may happen in the economy.

After reaching nearly $80 per share early in mid-May, Wal-Mart Stores, Inc. (NYSE:WMT) has stumbled to its current level of around $75 per share following a dim earnings report. Sales increased by just 1% in the fiscal 2014 first quarter earnings released in May. While management at the firm cited a delay in payroll tax and one less selling day than the same period last year as the catalysts for the poor performance, those could be scapegoats for the real reason: people aren’t bargain shopping as much. However, the report could be a one-off, as the firm is getting a hold on the grocery business and could drive up sales in that area in the months ahead.

Page 1 of 2

Biotech Stock Alert - 20% Guaranteed Return in One Year

Hedge Funds and Insiders Are Piling Into

One of 2015's best hedge funds and two insiders snapped up shares of this medical device stock recently. We believe its transformative and disruptive device will storm the $3+ billion market and help it achieve 500%-1000% gains in 3 years.

Get your FREE REPORT and the details of our 20% return guarantee today.

Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.
Loading Comments...
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 102% in 3 years!! Wondering How?

Download a complete edition of our newsletter for free!