COMPANY ANALYSIS

Wal-Mart Company Analysis

Wal-Mart Company Analysis

Company History

The name of the company derives from its founder, Sam Walton from (Wal Mart's ton). On 2 July 1962 Sam Walton opened his first Wal-Mart in Rogers (Arkansas), after its first store in 1950, a dime store at Town Square & Nickle town Bentonville, Arkansas had opened (Zellner, Schmidt, Ihlwan, & Dawley, 2001). Ten years later, in 1972, the company went public, which gave Sam Walton the necessary capital for expansion. The big rise only started in 1987 when Wal-Mart opened its first supermarkets under the name “Hypermarket USA”, with a time over the department store average ten times as large retail space (Rock, 2001).

The first store outside the United States opened in 1991 in Polanco in Mexico City. Wal-Mart now dominates much of the U.S. retail industry and with a turnover of 405.6 billion U.S. dollars (2008), the most profitable companies in the world (Zellner, Schmidt, Ihlwan, & Dawley, 2001). The group is also by far the largest private employer in the world with nearly two million employees (2006).

Recent and Current Operating Results

Wal-Mart reported earnings per share for the first quarter of $ 0.98, giving the estimate of analysts of $ 0.95. The result of the company rose 3.8% as international sales offset weak consumer spending in the U.S. The Wal-Mart sales are growing about 3% annually, down from 3.9% to growth in the third quarter of 2010 (see chart next page). The top-line is growing, but it seems that the speed is decreasing slightly. The objective of earnings per share for next quarter's own retail chain is in line with the expectations of analysts (Demos, 2004).

Revenue Growth - Wal-Mart Stores

In general, the consumer-oriented giants showed good results, which will definitely support the investor sentiment in the U.S. session of the day, as investors are still evaluating the latest data from the U.S. mixed (Zellner, Schmidt, Ihlwan, & Dawley, 2001).

Political, Social and Economic Forces

Political

The political influence on Wal-Mart is immense due to the ever changing political conditions. Even though the U.S. is a fairly stable state in terms of politics, yet there are still forces that affect the way the company functions (Rock, 2001). In the American case, safeguarded by the Free Trade Agreement (NAFTA), where the supposed transition to democracy and the belief that millions of consumers received poor service from local businesses in Latin America made ??an attractive place for U.S. investors. Such issues hinder the normal performances of retailers in the country and require expanding into the international arena endorsed by the FTAA (Demos, 2004).

Economical

Economic components are an issue of anxiety for Wal-Mart and Target since they influence exactly buying behaviour of customers. While the UK Treasury, was announced officially in a recession in 2008, a significant decrease in concern of the types of government help to minimize the increase in job losses during the year 2010. As a result, the purchasing power of buyers back into a steady growth, and they are more confident about their economic ...