Wal-Mart: Strong International Growth, Especially Latin America

Things appear to be going smoothly at Wal-Mart Stores Inc. (WMT). On Thursday, the world’s largest retailer raised its first quarter profit guidance and said sales in March climbed 0.7%. Its shares are also performing well, and as of Wednesday's close had risen 14% in 2008.

But Wal-Mart has stores all over the world, so when it hosts its international analyst meeting on April 17 to 18, the market will be listening. In addition to improving U.S. results, the company has made encouraging progress internationally, particularly in Latin America, according to Goldman Sachs analyst Adrianne Shapira. She thinks its returns will continue to improve, and continues to rate the shares a “buy” with a $55 price target.

In a note to clients Ms. Shapira said:

The company’s aggressive pricing message across both its domestic and international markets should facilitate future market share gains.

In Brazil, favorable macro drivers like low interest rates and strong real wage growth, as well as a growing middle class, should allow Wal-Mart to leverage its Every Day Low Price and multi-format strategy. The analyst also noted that more than 70% of the Brazilian population fits Wal-Mart’s target lower-income consumer profile, an approach that has paid off with better-than-planned results.

While Brazil only accounts for less than 10% of Wal-Mart’s international sales, the company hopes returns will double there in the next five years.

Comments

[Thomas888]

WMT stock has been performing well compared to many this year ,it seems to be in the news so it will probably pull back some before it continues upward.So buy more on the dip, if a dip happens,unless some negitive news or a down grade comes out on WMT it is a buy especially in this slow economic slow down when people are shopping and trying to save some money and get discounts by shopping at Wall Mart stores/ Sams club and Costco type of retailers.But some analysts will probably try to find a problem with, some might say its overbought and due for a pull back or there is a law suit pending etc, so they can downgrade it and make stock fall.If a company stock is doing good someone ,will usually try to sabatoge it, just to mess with its good fourtune when so many are having a hard time in this economic slow down. Its chart looks good trending up from left to right and that is a good story chart wise.I reasd a analysts upgraded WMT price target to 55. WMT is there allready closed firday 4-11 at $54.80 wouldnt a target price of $60 a share be a better target going forward for 08 another $5 up on the stock seems to me to be doable ,no problem if the trend in the stocks price continues? Thomas