Walmart - Long-term, possible ER play


Please take what I share as opinions and a presentation of data.

Let’s get into it.

When you hear the word Walmart, you think of hill billy Jim walking around smelling like last Wednesday, browsing through the overalls section while coughing COVID-19 molecules on all the denim.

When investors hear the word Walmart, most of them envision a money-printing machine.

Ranking 18th on the list of the world’s largest companies, it is 2nd only to Amazon (3rd to Apple, if you consider it retail) in a long list of retailers. Let’s see how they grew to that size.

This article describes what they sell but I’ll save you a click and sum it up for you:

Motherfucking everything.

What most people miss on Walmart is they just don’t sell physical products, which range from electronics, clothing, makeup, home improvement, groceries, etc. They also provide a range of services geared towards helping low-income individuals (their main demographic).

Some of these services include, but are not limited to:

Tax auditing
Money transfers
Healthcare (pharmacy)
Jerking you off in the sports section (kidding)

While the majority of their revenue does come from retail purchases, Walmart is continually looking for ways to generate more income by becoming price competitive on services that are price-friendly to the lower-income audience. One awesome example is their expansion into the healthcare space.

In June, they began selling insulin at 40-60% off regular cost. While it on paper this probably won’t drive up immediate revenue, it establishes a foundation for diabetics to start using Walmart for their insulin needs. It’s a smart as fuck way of helping people save money while driving foot traffic into Walmart.

Another large money-maker for Walmart is their international expansion.

We all know China is the world’s largest market, and Walmart is aggressively expanding their market share in the retail space there.

In addition to their plan to add 500 stores in the next few years, they’re integrating intelligently with local industry leader’s like to appeal to Chinese consumer trends (like on-demand delivery).

Expansion of services and penetrating international markets are just a couple examples of ways Walmart is looking to keep ahead of the curve. If you’ve noticed over the past years, Walmart and Amazon are essentially two heavyweights going back and forth in becoming the one-stop retailer for everything, whether that’s products or services. They both have room to grow, but imo Walmart has longer-term growth cause of their ability to focus on their consumers only, while Amazon is expanding in other aspects of business like cloud services. Did I also mention Walmart own’s Sam’s Club?

If you’re looking to play this upcoming ER, keep in mind there is a non-trivial bear case of supply chain issues that could pose as a large headwind for Walmart. Considering their business model of selling everything, and having plenty of everything to sell, they can be suffering from this headwind enough to lower future guidance.

Another bear case is the 100’s of mcdonalds locations that used to be inside walmarts, closing. This was a foot traffic driver as well as rent-cost padder. There are talks about another partnership and more food offerings but I couldn’t find anything.

If you’re not looking to play ER, there’s a strong case to buy and hold Walmart as a long-term stock. They’re not going anywhere, they have an enormous stronghold on their core target audience, and they’re continually expanding their revenue streams to increase revenue per customer. I’m personally a shareholder in my gay ass retirement account and am excited for their future.

There’s a lot I didn’t cover, and always feel free to present bear cases to my bull cases, or vice versa. I’m looking forward to hearing everyone’s thoughts on wally world.


I 100% agree, especially with inflation rising and people more likely to go to discount store like this or dollar tree/dollar general.

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I’m a back room manager at a Walmart in a major city.

I can’t speak for any other location, but my store’s sales are down about 5% from projections, and down about 3% YoY. Last quarter was about 6.4% down (current quarter is about 3% down)

There have not been major supply issues (certainly some particular items may have been hard to come by at times), people just aren’t spending money here.

Given my experience at my store, I’m not keen on playing the ER. Long-term though, I agree that Walmart is a great bet. Walmart+ is ramping up to better compete with Amazon Prime, and digital sales are booming.


As far as the restaurants go, I know several of them around here (Southeast US) have Subways in them. Those same ones also have US Banks in the building as well. Unsure if that’s a legit partnership plan nationwide.

Logistics and supply chain wise, Walmart uses their own fleet of trucks and drivers correct? This could help mitigate some of the issues other businesses encounter in that realm.

Great DD thank you

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Yes, that is correct. Walmart actually has one of the largest private truck fleets in North America (it could be the largest - I don’t recall the exact ranking).

My store has only seen some very minor delays (of up to several hours) on a few occasions due to driver shortages. It’s not common, and never serious.

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I would think that Wal-Mart is going to be hit heavily from the price impact of imported goods from their suppliers. The cost of ocean freight is still 10x+ from what it was in 2019. I would imagine this affects their Great Value branded products more heavily, but I’m curious how it’s affecting most other retailed items from other vendors.

I would like to think that the store impact that Keja is seeing is going to be pretty representative, except in metro areas where WMT has more significant competition, and the YoY sales decline is likely higher.


Some of this is copy-paste from my post in the earnings thread on walmart, but also some additional notes so it’s not 100% the same…

For some reason Walmart typically drops around earnings, I guess people always have too high of expectations or walmart just doesn’t do a good job of selling it. However there are some recent improvements that I think are going to impress investors and should continue to be bullish on the company.

First, they have been overhauling stores going from the “instore pickup” to simply “drive up” store pickup. You just park in a space and text them letting them know you are there. They come out and load up your items, you literally don’t even have to get out of your seat. The stores around me the associates are like busy bees going around filling orders, honestly sometimes I think there are more employees running around than shoppers. People really seem to be utilizing this feature since it’s free and extremely convenient. They have 2 isles in my super center parking lot reserved for people to park for pickup, and while it’s generally maybe 1/3 full when I go to shop I bet they are expecting holidays to REALLY pick up with this feature.

Don’t want to drive to the store to pick your stuff up? No problem, you can schedule Home Delivery! Yep, walmart branded vehicles making local deliveries right to your door, including perishable goods.

Walmart has been expanding their super centers this year to add additional warehouse space. As we’ve seen with all the supply chain issues having a JIT inventory system simply doesn’t work for high-demand items so they are trying to hold more inventory at stores to have more of a buffer, especially so for the holiday shopping season . Also this eases load and capacity on the distribution centers. The additional “behind the scenes” space also houses all the queued store pickup / delivery items.

To complement the pickup / delivery service and other new features Walmart has revamped their app and streamlined it.

Walmart is no stranger to supply chain issues, if one supplier can’t deliver they will find alternate suppliers in a heartbeat to keep their shelves stocked as best they can.

Walmart is gearing up to offer HEALTH CARE in their super centers (many stores are being remodeled right now), and I’m not talking about their existing pharmacy services… I’m talking like full service see a doctor, get x-ray’s, and whatever else general doctors offices might do (maybe even pediatrician services?). Likewise they appear to be expanding their vision centers, I guess the world is going blind or something from staring at their phones all day.

Finally, walmart is starting to dabble in the drone delivery service and automated driving. They have a self-driving (and I believe it’s even un-manned) box truck drive between a warehouse and a store as a pilot program. This will only help to expedite goods between the distribution centers and the stores or other locations.

TL;DR - Bullish on Walmart for long-term, but don’t trust earnings to go up.

super appreciate this insight @TheMadBeaker - the more digging I’m doing I’m iffy on this being an ER play, but more of a long-term hold. Their expansion into different verticals as well as continued international expansion is huge imo.

You would have to check the location of where the goods come from. The “port backlog” is only in California (figures) for goods coming from China. The Gulf & East Coast ports are operating just fine for all goods coming from Central & South America, and Europe.

Most Great Value products actually come from USA sources, otherwise they will list the country of origin on them.

Interesting article: Who Makes Great Value Products For Walmart? (27 Products)

Not defending walmart, but you just have to realize a lot of grocery goods come from US, Mexico, or Canada, and to a lesser-extent South America. America has great farm & ranch land and we actually export a lot to other countries. Soybeans, Corn, and Pork are top export items.

Wow, beat me to my Dd. Good job

I will comment that of all retailers, I expect Walmart to be most insulated from supply chain issues because they’ve been operating their own fleet for years and they’ve been know as one of the best employers in trucking for that time. It’s a pretty coverted job for OTR drivers. They still rely heavily on third parties as well, but they’re not as dependent on it as other retailers.

Here is some twitter sentiment and purchase intention data for WMT earnings. Slight bullish…

I know baby formula and essential baby products are expensive. We moved to Walmart and Sam’s because their formula was affordable. You are spot on with the value they provide the demographic they serve. I like how Walmart stays out of the news too.

I went to my local Supercenter this morning (Saturday after Black Friday) just for grocery shopping, probably got there a little after 9am… Surprisingly the store was pretty empty, about the same low-traffic as mid-morning on a weekday! I don’t know how busy it was yesterday, I didn’t dare venture to any stores on black friday. I left at about 10:30 and it was still just as empty, there was one other person in the huge self-checkout area.

I know most retailers have been starting “black friday” deals early, for at least a week if not since the beginning of November. Also YoY people shop online more and have their stuff shipped or pick up (and in fact there’s some walmart deals that are online only I guess so they don’t have to deal with the hassle of distribution problems).

An article on CNBC from a couple days ago said, “A record-high amount of people, or 11.5% of Americans, aren’t buying any gifts this holiday season, according to a survey by Deloitte.” IMO, with the rising costs of groceries, gas and everything else people are simply cutting back on discretionary purchases, i.e. holiday gifts.

Personally, looking over all the black friday ads everything was just luke warm and identical items from last year were priced around 10% higher (yay inflation).

Probably too early to tell and I’m sure we will start to see some sales numbers this next week, but seems like this Holiday season has started with a fizzle rather than a bang.

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Bad news for Walmart’s holiday sales for the PS5:

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