Looks like Wall Street is starting to turn a cold shoulder to Walmart also... check out this article from thestreet.com... (article link not included because it requires subscription)
When I first went to Arkansas and saw Wal-Mart (WMT:NYSE - commentary - research) in 1980, I knew that a fierce competitor was coming the nation's way. You had nice, clean stores, a good array of merchandise and extraordinarily low prices. But you couldn't convince a soul in the Northeast, where there were no Wal-Marts, that Wal-Mart was going to wipe out everyone from Ames to Kmart (KMRT:Nasdaq - commentary - research) to Bradlees to Woolworth to Caldor to Jamesway. No, those were entrenched chains that had loyalty and bargains and were considered viable, growing businesses with decent brands and fine stores.
By the time Wal-Mart was ready to come East, it handily destroyed those competitors, both on price and selection, and the game was over.
Now Wal-Mart is considered invincible by everyone. The Northeast intelligentsia, who still never shop there, refuse even to think that Wal-Mart can be beaten. The intelligentsia think that Wal-Mart is going to crush everyone else that is left, and that it is just a matter of time before it happens.
Which is why, for the umpteenth month, the intelligentsia are willing to overlook another horrible Wal-Mart number from the biggest weekend in shopping. Which is why the intelligentsia are willing to say that the economy must be bad -- I mean, how else could Wal-Mart miss its numbers so badly?
Maybe it's my Pennsylvanian sensibilities -- the red state part of Pennsylvania, where I lived and shopped at Wal-Mart for many years -- but I have to tell you that I think Wal-Mart's problems are uniquely Wal-Mart's. Management hasn't changed the look or feel of the stores in decades. The stores are dowdy. The aisles are ugly. There's nothing exciting or different or even colorful at Wal-Mart. It feels almost Soviet in its selection and presentation.
Now, when I go to Target (TGT:NYSE - commentary - research), I feel pampered and turned on about the merchandise. I can't get the kids to go to a Wal-Mart, but a Target Greatland? All aboard. Wal-Mart is, quite frankly, a depressing place to shop, a place that reminds me of where I had to go when I didn't have a lot of money.
I think that most Americans -- despite what the intelligentsia say -- also feel that if they are doing well, they don't have to go to Wal-Mart. They would rather go to Target. If they want bargains, they would rather go to Costco (COST:Nasdaq - commentary - research) or BJ's (BJ:NYSE - commentary - research). If they want electronics, they would like to go to Best Buy (BBY:NYSE - commentary - research). If they want hardware and outdoor stuff, they would rather go to Lowe's (LOW:NYSE - commentary - research) or Home Depot (HD:NYSE - commentary - research). They all are better shopping experiences than Wal-Mart.
It is fitting that the intelligentsia -- who, again, never shop at Wal-Mart -- now are telling me that Wal-Mart's weakness is America's weakness. That same false tell has gone on for almost two years now, and yet the intelligentsia are unmoved. I'm not. Wal-Mart's weaknesses allowed me to see Kmart and Target, and capture some of those moves. It allowed me to talk about Home Depot and Lowe's to my radio listeners. It allows me to avoid the myopic view that the country can't be doing well because Wal-Mart is not doing well.
So, like the intelligentsia in the 1980s who didn't see Wal-Mart coming, the intelligentsia in the 2000s can't see it is foundering. Wal-Mart is too strong financially to ever truly get in trouble. But if it doesn't get some panache or some joie de vivre, I think it will report numbers very similar to this weekend's for some time to come.
And the other guys will win.
) and the only thing people were buying were the free after rebate items. There were lines 150 feet long throughout the store to get those items. I wonder if the only items to sell anywhere were the loss leader door busters? Your experience and comments?
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