Wal-Mart Stores, Incorporated (WMT)
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Company Information
H. Lee Scott, Jr., CEO/President/Director
702 Southwest 8th Street
Bentonville, AR 72716
US
Map it ![]()
Phone: (479) 273-4000
Fax: (479) 273-4053
Latest news from Portfolio
-
Wal-Mart: Strength, but UncertaintyMay 13 2008
-
Wow, Wal-MartMay 08 2008
-
Retailers Lay an EggApr 10 2008
-
Hard Times, Solid SalesMar 06 2008
-
Cleanup in Aisle 8Feb 22 2008
Portfolio.com Overview
Industry:
Retail
Summary:
The Company which is engaged in the operation of general merchandise and food discount stores in the United States.
Primary executive:
Robert J. Ulrich,
Ivan G. Seidenberg
Industry:
Telecomm
Biography:
IMr. Seidenberg, 61, Chairman and Chief Executive Officer, Verizon Communications Inc.; President and Chief Executive Officer
WHERE THEY CAME FROM
Sam Walton opened the first Wal-Mart store in Rogers, Arkansas, in 1962, the same year that Kmart and
Target were born. The early shops were five-and-dimes, but over time Wal-Mart evolved into its now ubiquitous big-box form. The company went public with 18 outlets in 1970; by 1999 it had become the largest private-sector employer in the world.
WHAT THEY DO
Wal-Mart sells everything from gasoline to boxer shorts at discount prices to the 176 million customers who visit its stores each week.
The low prices are a result of hard-nosed negotiations with suppliers, sophisticated inventory management, and a famously efficient supply-chain-management system that serves a network of stores located in small towns. The business model counters lower-than-average markups with huge sales volume.
As of December 2006, Wal-Mart employed 1.8 million people and owned nearly 6,500 stores around the world.
WHY THEY’RE CONTROVERSIAL
Wal-Mart is simultaneously the most admired and most disliked company in the country.
Wal-Mart prides itself on being a place that helps the little guy buy what he otherwise could not afford. And according to one study (commissioned by Wal-Mart), American consumers devote a smaller portion of their incomes to food and goods because of Wal-Mart.
But critics say these savings come at a high cost: Wal-Mart is frequently accused of encouraging American manufacturers to save money by producing their wares overseas, and the company has been slammed for its labor practices and perceived negative impact on local communities.
Walton said that he originally opened his stores in small towns because his wife refused to move to a place with more than 10,000 residents. Keeping stores outside of urban centers has helped the company maintain lower costs and prices, but has also resulted in pressure on mom-and-pop stores. Since 2005, Wal-Mart has nixed plans for at least three different New York City stores amid opposition from the community, labor organizations, and city government.
Low hourly pay and limited access to health insurance are just the tip of the iceberg when it comes to labor complaints. In late 2006, the company was ordered to pay $78 million after losing a class-action suit brought by employees in Pennsylvania who said they were forced to do work off the clock. Wal-Mart lost a similar $172 million lawsuit in California in 2005 for denying employees meal breaks. The chain is also the defendant in the largest civil rights class-action lawsuit in history, which alleges that Wal-Mart systematically discriminated against 1.5 million female employees.
Labor unions have long criticized Wal-Mart, but since 2005, two union-funded watchdog groups—Wal-Mart Watch and Wake Up Wal-Mart—have hounded the company. Bad press may also be taking a toll: According to a 2004 McKinsey & Co. study, 2 to 8 percent of Wal-Mart customers surveyed stopped shopping at the chain because of its negative image.
WHAT’S NEXT
While sales and profits remain strong, Wal-Mart’s stock has been down since 1999—and during the entire tenure of C.E.O.
H. Lee Scott, who took the reins in 2000. Scott has been moving the company away from classic Wal-Mart practices in order to expand its customer base.
In 2006, Wal-Mart began targeting niche demographics—including wealthy shoppers, African Americans, baby boomers, and Hispanics—with specialized merchandise. It has had success in some urban locations by featuring groceries selected to appeal to Hispanic buyers, but the retailer may yet return to its successful all-low-prices, one-inventory-fits-all strategy.
The company has pledged to become greener by reducing its energy use in stores, improving the energy efficiency of its vehicles, and cutting back on the amount of solid waste its stores produce. It has also begun to promote organic food and long-lasting lightbulbs. These policies could make a significant impact: Wal-Mart is the largest private user of electricity in the U.S. and operates one of the nation’s biggest truck fleets. —S.E. Kramer
Sam Walton opened the first Wal-Mart store in Rogers, Arkansas, in 1962, the same year that Kmart and
WHAT THEY DO
Wal-Mart sells everything from gasoline to boxer shorts at discount prices to the 176 million customers who visit its stores each week.
The low prices are a result of hard-nosed negotiations with suppliers, sophisticated inventory management, and a famously efficient supply-chain-management system that serves a network of stores located in small towns. The business model counters lower-than-average markups with huge sales volume.
As of December 2006, Wal-Mart employed 1.8 million people and owned nearly 6,500 stores around the world.
WHY THEY’RE CONTROVERSIAL
Wal-Mart is simultaneously the most admired and most disliked company in the country.
Wal-Mart prides itself on being a place that helps the little guy buy what he otherwise could not afford. And according to one study (commissioned by Wal-Mart), American consumers devote a smaller portion of their incomes to food and goods because of Wal-Mart.
But critics say these savings come at a high cost: Wal-Mart is frequently accused of encouraging American manufacturers to save money by producing their wares overseas, and the company has been slammed for its labor practices and perceived negative impact on local communities.
Walton said that he originally opened his stores in small towns because his wife refused to move to a place with more than 10,000 residents. Keeping stores outside of urban centers has helped the company maintain lower costs and prices, but has also resulted in pressure on mom-and-pop stores. Since 2005, Wal-Mart has nixed plans for at least three different New York City stores amid opposition from the community, labor organizations, and city government.
Low hourly pay and limited access to health insurance are just the tip of the iceberg when it comes to labor complaints. In late 2006, the company was ordered to pay $78 million after losing a class-action suit brought by employees in Pennsylvania who said they were forced to do work off the clock. Wal-Mart lost a similar $172 million lawsuit in California in 2005 for denying employees meal breaks. The chain is also the defendant in the largest civil rights class-action lawsuit in history, which alleges that Wal-Mart systematically discriminated against 1.5 million female employees.
Labor unions have long criticized Wal-Mart, but since 2005, two union-funded watchdog groups—Wal-Mart Watch and Wake Up Wal-Mart—have hounded the company. Bad press may also be taking a toll: According to a 2004 McKinsey & Co. study, 2 to 8 percent of Wal-Mart customers surveyed stopped shopping at the chain because of its negative image.
WHAT’S NEXT
While sales and profits remain strong, Wal-Mart’s stock has been down since 1999—and during the entire tenure of C.E.O.
In 2006, Wal-Mart began targeting niche demographics—including wealthy shoppers, African Americans, baby boomers, and Hispanics—with specialized merchandise. It has had success in some urban locations by featuring groceries selected to appeal to Hispanic buyers, but the retailer may yet return to its successful all-low-prices, one-inventory-fits-all strategy.
The company has pledged to become greener by reducing its energy use in stores, improving the energy efficiency of its vehicles, and cutting back on the amount of solid waste its stores produce. It has also begun to promote organic food and long-lasting lightbulbs. These policies could make a significant impact: Wal-Mart is the largest private user of electricity in the U.S. and operates one of the nation’s biggest truck fleets. —S.E. Kramer
Portfolio Articles
-
Wal-Mart: Strength, but Uncertainty
Retailer posts robust results, but sees U.S. weakness.May 13 2008 -
Wow, Wal-Mart
Amid hard times, retail giant shows strong sales.May 08 2008 -
Retailers Lay an Egg
Early Easter hurt sales, but Wal-Mart raises profit forecast.Apr 10 2008 -
Hard Times, Solid Sales
Wal-Mart reports gain that exceeds forecasts.Mar 06 2008 -
Cleanup in Aisle 8
Why supermarket chains are poised to do well in a recession.Feb 22 2008
News Feeds
-
Sector Preview: June same-store sales seen up
AP
Jul 08 2008
-
Stocks rise on banks and lower oil
Reuters
Jul 08 2008
-
Closing glance: Broadline retailers
AP
Jul 08 2008
-
Midday Leaders & Laggards: DJIA
AP
Jul 08 2008
-
Analyst affirms 'Buy' rating on Wal-Mart
AP
Jul 03 2008
-
Opening glance: Broadline retailers
AP
Jul 02 2008
-
Wal-Mart branches out into locally grown produce
AP
Jul 02 2008
-
Judge finds Wal-Mart violated Minnesota labour laws
Reuters
Jul 01 2008
-
Judge rules against Wal-Mart on work breaks
AP
Jul 01 2008
-
Opening glance: Broadline retailers
AP
Jun 30 2008
Portfolio Blogs
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Morning Hemlines: Wal-Mart, Pringle, YSL, Kors, Ecko
Jul 02 2008
-
Always Low Motives. Always.
Jul 01 2008
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Wal-Mart Stops Hyphenating
Jun 30 2008
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Idle Chatter: Wal-Mart Tries Selling Ads
Jun 03 2008
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Fashion Breakfast: Kohls, Saks, Wal-Mart, Make up for Men
Mar 05 2008
Press Releases
-
Seven Summits Research Releases Comments on WMT, MRK, DIS, AMR, and RSH Jul-07-2008, 10:34AM EDT
-
Wal-Mart Commits to America's Farmers as Produce Aisles Go Local Jul-01-2008, 09:30AM EDT
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America I AM Exhibition Mobile Experience Begins Nationwide Tour July 4 Jun-30-2008, 05:03PM EDT
News From Around the Web
News
-
Business Reporting Pet Peeves
(iStockAnalyst)Jul 08 2008 -
Two-vehicle crash sends car into Clay Wal-Mart
(Syracuse Post-Standard)Jul 08 2008 -
Staunton Police Search for Two who Robbed Wal-Mart
(NBC 29 Charlottesville (WVIR))Jul 08 2008 -
Don't Outsource Your Code Development to Strangers
(CIO Magazine)Jul 08 2008 -
Car hits Clay Wal-Mart
(NBC 3 Syracuse (WSTM))Jul 08 2008 -
Teen Girl Nearly Kidnapped At Wal-Mart
(CBS 6 Orlando (WKMG))Jul 08 2008 -
Broadline Retailers rise as investor concern eases on rising dollar, falling oil
(Canadian Business Online)Jul 08 2008 -
Memphis OPD recommends rejection of Wal-Mart at Houston Levee and Macon
(Memphis Business Journal)Jul 08 2008 -
Wal-Mart Eyes $287M Benefit from RFID
(CIO Magazine)Jul 08 2008 -
Mexican comic book irks African-Americans
(United Press International)Jul 08 2008
Blogs
-
Jul 08 2008
-
Walmart on Sustainability
(core77.com's design blog)Jul 08 2008 -
Jul 08 2008
-
Take it Private! Rex Stores
(BloggingBuyouts)Jul 08 2008 -
Wal-Mart might help your portfolio during the recession
(Blogging Stocks)Jul 08 2008
Employees
Number of Employees: 2,100,000
Revenue per Employee: $192,814
Top Executives
J. B. Menzer, Chief Administrative Officer/Vice Chairman
C. Douglas McMillon, Divisional CEO/Divisional President/Executive VP
Michael T. Duke, Divisional Vice Chairman
Thomas M. Schoewe, Executive VP/CFO
Thomas D. Hyde, Executive VP/Secretary
Rollin L. Ford, Executive VP/Chief Information Officer
Lawrence V. Jackson, Divisional Executive VP
Eduardo Castro-Wright, Divisional CEO/Divisional President/Executive VP
M. Susan Chambers, Executive VP, Divisional
Charles M. Holley, Jr., Divisional Executive VP/Treasurer
Steven P. Whaley, Senior VP/Controller
Lesile A. Dach, Executive VP, Divisional
Board of Directors
Financials
Quarterly
Annual
| Income Statement | 05/2008 | 02/2008 | 11/2007 | 08/2007 |
|---|---|---|---|---|
| Sales | 70.26 Bil. | 79.66 Bil. | 67.7 Bil. | 69.02 Bil. |
| Gross Operating Profit | 23.86 Bil. | 26.61 Bil. | 23.18 Bil. | 22.97 Bil. |
| Operating Income before D & A (EBITDA) | 5.76 Bil. | 7.38 Bil. | 5.5 Bil. | 5.84 Bil. |
| Total Income Before Interest Expenses (EBIT) | 4.19 Bil. | 6.94 Bil. | 5.05 Bil. | 5.38 Bil. |
| Total Net Income | 3.02 Bil. | 4.1 Bil. | 2.86 Bil. | 2.95 Bil. |
| Basic EPS, Total | 0.76 | 1.03 | 0.71 | 0.72 |
| Diluted EPS, Total | 0.76 | 1.02 | 0.7 | 0.72 |
| BALANCE STATEMENT | 05/2008 | 02/2008 | 11/2007 | 08/2007 |
|---|---|---|---|---|
| Cash and Equivalents | 8.07 Bil. | 5.57 Bil. | 4.95 Bil. | 6.09 Bil. |
| Total Assets | 50.3 Bil. | 47.4 Bil. | 50.91 Bil. | 46.39 Bil. |
| Total Liabilities | 61.1 Bil. | 58.15 Bil. | 60.35 Bil. | 55.25 Bil. |
| Total Capitalization | 95.61 Bil. | 94.41 Bil. | 93.15 Bil. | 90.25 Bil. |
| Cash Flow | 05/2008 | 02/2008 | 11/2007 | 08/2007 |
|---|---|---|---|---|
| Net Cash From Continuing Operations | 3.7 Bil. | NA | 9.27 Bil. | 6.44 Bil. |
| Net Cash From Investing Activities | -2.23 Bil. | -15.67 Bil. | -11.22 Bil. | -7.18 Bil. |
| Net Cash From Financing Activities | 865 Mil. | -7.13 Bil. | -878 Mil. | -860 Mil. |
| Net Change in Cash & Cash Equivalents | 2.5 Bil. | -2.2 Bil. | -2.42 Bil. | -1.28 Bil. |
| Income Statement | 2008 | 2007 | 2006 | 2005 |
|---|---|---|---|---|
| Sales | 280.2 Bil. | 258.69 Bil. | 235.67 Bil. | 215.39 Bil. |
| Gross Operating Profit | 94.33 Bil. | 86.3 Bil. | 76.75 Bil. | 69.83 Bil. |
| Operating Income before D & A (EBITDA) | 24.04 Bil. | 22.3 Bil. | 20.02 Bil. | 18.73 Bil. |
| Total Income Before Interest Expenses (EBIT) | 22.3 Bil. | 20.78 Bil. | 18.78 Bil. | 17.29 Bil. |
| Total Net Income | 12.73 Bil. | 11.28 Bil. | 11.23 Bil. | 10.27 Bil. |
| Basic EPS, Total | 3.13 | 2.71 | 2.68 | 2.41 |
| Diluted EPS, Total | 3.13 | 2.71 | 2.68 | 2.41 |
| BALANCE STATEMENT | 2008 | 2007 | 2006 | 2005 |
|---|---|---|---|---|
| Cash and Equivalents | 5.57 Bil. | 7.37 Bil. | 6.41 Bil. | 5.49 Bil. |
| Total Assets | 47.4 Bil. | 46.59 Bil. | 43.82 Bil. | 38.49 Bil. |
| Total Liabilities | 58.15 Bil. | 51.75 Bil. | 48.83 Bil. | 42.89 Bil. |
| Total Capitalization | 94.41 Bil. | 88.8 Bil. | 79.6 Bil. | 69.48 Bil. |
| Cash Flow | 2008 | 2007 | 2006 | 2005 |
|---|---|---|---|---|
| Net Cash From Continuing Operations | NA | 19.32 Bil. | 17.63 Bil. | 15.04 Bil. |
| Net Cash From Investing Activities | -15.67 Bil. | -14.46 Bil. | -14.18 Bil. | -12.35 Bil. |
| Net Cash From Financing Activities | -7.13 Bil. | -4.84 Bil. | -2.42 Bil. | -2.61 Bil. |
| Net Change in Cash & Cash Equivalents | -2.2 Bil. | 959 Mil. | 926 Mil. | 289 Mil. |
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