Since bottoming in mid-November at $56.30 a share, Wal-Mart Stores Inc. (NYSE: WMT) shares have gained over 17% and was the best performing Dow 30 stock in 2016 until Thursday’s post-earnings drop. Despite the fall though, the stock is still among the Dow’s best this year, handily outperforming the industrial index, to the surprise and considerable confusion of many an analyst. Unless you bought at or near the bottom though, take that with several grains of salt, because 2015 was not friendly to Wal-Mart shareholders by a long shot. Shares are still 25% lower than they were a year ago.

The 52-week performance notwithstanding, everyone is scratching their heads as to why the stock is doing generally well while the rest of the Dow has performed so dismally. While there is no absolute answer to this question, there is a confluence of factors that, taken together, help explain what has happened since November. They include individual developments within Wal-Mart itself, general developments in the retail sector of which Wal-Mart is the biggest part, and finally much wider developments within the boom-bust business cycle as a whole.

First let’s take Wal-Mart-specific factors. In terms of the stock itself, Wal-Mart was the worst performing Dow Jones Industrial Average stock in 2015. Now, in any given year there is always a worst performing Dow stock, so that by itself is not groundbreaking news. What is remarkable about Wal-Mart being the worst 2015 Dow stock is that it happened specifically during a year of spectacular oil price declines and a collapse of commodity prices in general. Normally this should help retailers like Wal-Mart because they have lower operating expenses in such an environment.

Despite this, Wal-Mart shares got destroyed last year even worse than commodity and oil-based Dow stocks themselves like Caterpillar, Exxon Mobil and Chevron. While Wal-Mart as a company had a dismal 2015, for an established retailer to fall more than commodity stocks during a commodity price collapse does not make any sense. The sell-off, while deserved, was exaggerated and a bounce inevitable.

The second Wal-Mart specific factor is its closure of 269 stores globally back in January and the ending of the unsuccessful Wal-Mart Express. Closures are painful but designed to improve the bottom line at the expense of the top line, and that’s what probably will happen here.

As for developments from within the retail sector as a whole, retail was clobbered in 2015 with worries that e-commerce would bankrupt department store chains and smaller boutique retailers. Investors were deathly worried about holiday sales numbers, and for good reason. These worries bled into Wal-Mart and its competitors last year. Since November however, when Wal-Mart shares started recovering and outperforming the Dow, so have its competitors Target Corp. (NYSE: TGT) and Costco Wholesale Corp. (NASDAQ: COST). The Dow is down over 4.5% since Wal-Mart bottomed. Target and Costco are both up, not as high as Wal-Mart though since their declines were not as extreme. Large retailers are not as threatened by e-commerce as smaller niche retailers, and the market has figured that out since November it seems.

As for the business cycle, the rise of large low-cost retail stocks like Wal-Mart, Costco and Target may be signaling that consumer prices are on the rise and inflation is returning. Credit is still expanding fast, and eventually that credit bleeds into the consumer sector. Not good for consumers, but good for cheap discount retailers that sell to them. The producer price index just saw a surprise jump. The rise of Big Retail since November may be signaling that the minor smell of inflation may soon become an unbearable stench.

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