• MarketWatch has a story about how RBC analysts are suggesting that Walmart may have grown about as much as it is going to, saying that after years of growing, “virtually everyone that was going to shop at Walmart, already shops at Walmart."
What this means, the analysts say, is that "recent store closures and labor investments are a step in the right direction, but we feel that a lot more changes need to be made, from greatly improving retail basics to further simplifying the portfolio ... We also believe the company’s significant earnings reset is likely a ‘necessary evil’ as it adapts to today’s rapidly changing retail environment.”
And, the analysts say that Walmart's e-commerce investments, while yielding results, are "unlikely to move the needle in the near future, and we expect it to be margin dilutive over time.”
What this means, the analysts say, is that "recent store closures and labor investments are a step in the right direction, but we feel that a lot more changes need to be made, from greatly improving retail basics to further simplifying the portfolio ... We also believe the company’s significant earnings reset is likely a ‘necessary evil’ as it adapts to today’s rapidly changing retail environment.”
And, the analysts say that Walmart's e-commerce investments, while yielding results, are "unlikely to move the needle in the near future, and we expect it to be margin dilutive over time.”
- KC's View:
