Now, there’s initially some logic to that. The payroll tax increase hurts the lower and middle class that Wal-Mart relies on for the bulk of their business. If folks have 2% less in take-home pay, they will naturally have less to spend after their bills are paid.
However, isn’t Wal-Mart Stores, Inc. (NYSE:WMT) the low-price leader? Shouldn’t shoppers be trading down to the leading discounter to stretch their leaner disposable income?
More importantly, Wal-Mart’s comps couldn’t even keep up with inflation — up less than 2% last year and flat the year before — during the years where the payroll tax cut was supposedly stimulating the economy. There’s something more happening at Wal-Mart, and it’s a taxing dilemma for shareholders.
5. Shamu is all wet
Companies going public only have one chance to make a first impression.
SeaWorld Entertainment Inc (NYSE:SEAS) fell short in its first quarter as a public company. The theme park operator missed Wall Street’s profit targets in its quarter of trying to live up to historically conservative estimates. SeaWorld Entertainment Inc (NYSE:SEAS)’s net income of $0.41 a share fell woefully short of the $0.51 a share that the market was expecting.
A sharp decline in traffic resulted in a weaker profit than what the pros were targeting. The gamble to raise ticket prices resulted in fewer turnstile clicks. SeaWorld Entertainment Inc (NYSE:SEAS) can get through this, but if this is a sign of things to come, investors had no reason bidding up the shares the day that it went public.
Shamu’s the only one making a big splash here.
The article This Week’s 5 Dumbest Stock Moves originally appeared on Fool.com and is written by Rick Munarriz.
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