Wal-Mart Stores Inc. (NASDAQ: WMT) appears to be back to its game of 2008 and late 2007 after being a bit cautious last month. The company beat its January expectations, and it looks like this continues to be at the expense of Target Corp. (NYSE: TGT).
Wal-Mart’s same store sales on an ex-fuel basis were +2.1% for January. Because the company had been so cautious before, estimateswere only about +1.1% for the month.
But at Target, it looks like their shoppers are still migrating over toWal-Mart. Its same store sales fell by -3.3%. The good news is thatestimates were for a drop of close to 5%. The company saidfourth quarter results will be slightly under the $0.86 EPS views.
Wal-Mart shares are up almost 2% at $47.35 and Target shares are down by less than 1% at $31.25 in pre-market trading.
Everything keeps pointing to Wal-Mart’s favor for the near-term. It is not just at Target’s expense. Costco warned yesterday. Most retail sales are way off at other chains as well.
This is the trade down economy in full force. Itmay stay that way for quite some time. Our country’s unemployment is expected tobe about 7.5% when figures are reported tomorrow. There are about 4.8 million people on the unemployment rolls. And the Obama administration has said that millions more of jobsmay be lost.
Jon C. Ogg
February 5, 2009
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