business news in context, analysis with attitude

...with brief, occasional, italicized and sometimes gratuitous commentary…

• The Wall Street Journal reports that when Walmart's first quarter financial results come out later today, it is expected that they will show "steady progress at a time when brick-and-mortar competitors are stumbling." Analysts are expecting that Walmart will continue its same-store sales will increase for an eleventh straight quarter.

The story also suggests that Walmart will look good because it "has been raising wages, cutting prices and growing online sales, particularly in the U.S. These are necessary investments that have weighed on earnings. But more people have been going to Wal-Mart’s stores and actually buying stuff - something few retailers can brag about these days." And, investors "also are giving Wal-Mart the benefit of the doubt as it bulks up its e-commerce operations," mostly through its $3.3 billion purchase of Jet.

"The Jet purchase helped juice online sales in the U.S.," the Journal writes, "which rose 29% in the fourth quarter from a year ago. Now Wal-Mart is pushing in-store pickup of online orders as a way to get people to keep going to their physical locations. Wal-Mart is charging online buyers less if they go to stores and pick up their orders, a strategy aimed at competing with rival Inc."

I'm posting this well in advance of the Walmart numbers release, but I agree that investors should see Walmart's e-commerce efforts as positive, even if they don't have a short-term ROI. This is a long game, not a short one ... and Walmart should be lauded for taking the long view.
KC's View: