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Message
I bought WMT today
Posted on 6/29/18 at 10:59 am
Posted on 6/29/18 at 10:59 am
I could bore you with a bunch of financial analysis about WMT that in and of itself would not have given me any reason to buy the stock. I bought it for one reason---their new buy online/pick up at store is catching on and bringing in people that never shop in the store at WMT. It can be the game changer that turns around their same store sales declines.
Retailers have been beat up and rightfully so. The disrupter AMZN has hit them all and all of them have done all sorts of things in attempts to combat AMZN. WMT has found the solution. Their interface for buying online is user friendly. Their app is great. Nobody has the assortments in house in as many locations as WMT. They have a huge competitive advantage.
I started paying attention to this about two months ago. My wife had probably not been in a WAL store in two or three years discovered this buy online business a couple of months ago and now she buys groceries there at least once per week. Seeing this I started asking other people about it. One of the lawyers I use does it. A couple I know with a baby loves it because they can pick up diapers and formula without going in the store. None of these people are typical WMT customers.
I think this will catch on even more. It may cannibalize some of their traditional business but it will more than offset that business with new business. If they can add same store sales increases of even 1 or 2% because of this it would be huge on their income statement.
I bought today at $86 and I would not be surprised to see $120 before the end of 2019 or by mid 2020.
What do you think?
Retailers have been beat up and rightfully so. The disrupter AMZN has hit them all and all of them have done all sorts of things in attempts to combat AMZN. WMT has found the solution. Their interface for buying online is user friendly. Their app is great. Nobody has the assortments in house in as many locations as WMT. They have a huge competitive advantage.
I started paying attention to this about two months ago. My wife had probably not been in a WAL store in two or three years discovered this buy online business a couple of months ago and now she buys groceries there at least once per week. Seeing this I started asking other people about it. One of the lawyers I use does it. A couple I know with a baby loves it because they can pick up diapers and formula without going in the store. None of these people are typical WMT customers.
I think this will catch on even more. It may cannibalize some of their traditional business but it will more than offset that business with new business. If they can add same store sales increases of even 1 or 2% because of this it would be huge on their income statement.
I bought today at $86 and I would not be surprised to see $120 before the end of 2019 or by mid 2020.
What do you think?
This post was edited on 6/29/18 at 11:04 am
7
Posted on 6/29/18 at 11:10 am to I B Freeman
Every major grocer is doing the same thing.
Walmart is more defensive than a lot of other stocks though. They also can adapt a lot of the technology on their own as opposed to having to make major acquisitions to get it.
Walmart is more defensive than a lot of other stocks though. They also can adapt a lot of the technology on their own as opposed to having to make major acquisitions to get it.
Posted on 6/29/18 at 11:16 am to I B Freeman
So adding about $100B to market cap over the next year or so? Not making a case either way but that’s a big hurdle for WMT to clear.
I do like the play.
I do like the play.
Posted on 6/29/18 at 11:52 am to southernelite
No grocer has the SKUs or the number of outlets as WMT but nonetheless adding 1 or 2% in same stores sales growth over and above the natural growth they have now will be huge. They have a huge competitive advantage.
You are correct on their technology BUT they have made huge acquisitions in this regard that are just now starting to be incorporated into the WMT model of retailing.
You are correct on their technology BUT they have made huge acquisitions in this regard that are just now starting to be incorporated into the WMT model of retailing.
This post was edited on 6/29/18 at 11:56 am
Posted on 6/29/18 at 11:53 am to LSUcam7
Still would be less than their market cap just a year or so ago.
Posted on 6/29/18 at 1:54 pm to I B Freeman
While I do shop at Walmart (typically the local "Neighborhood Market" version as opposed to the big ones), I have been getting mailings about this service and have strongly considered giving it a try. Don't know if it has quite the upside you're thinking, but it's bound to have a positive effect.
Posted on 7/2/18 at 7:45 am to I B Freeman
quote:
with a baby loves it because they can pick up diapers and formula without going in the store.
Sir/Ma'am, you realize that Amazon can bring to your door right? Prime is same day shipping for most products. Basically, Wal-Mart wants people to drive to their location and pick up their stuff. Why do that? If I'm driving to Wal-Mart, I might as well go inside and do some impulsive shopping. The only people this benefits are people who are too scared to have packages laying outside all day while they are at work and people who drive by Wal-Mart on the way home.
Once AMZN starts installing secure package containers in everyone's yard or installs a butt load around the city ( customer gets a digital code sent to their mobile device to unlock), Wal-Marts model goes up in smoke. I hate both of these companies but that is not a good reason to buy stock in WMT. I'm sure there are better reasons. For instance, Wal-Mart has a grip on the population who has no internet service and retirees; however, both of those examples will soon fade away in the next 10-20 years. The younger generation embraces technology and internet will become available to everyone everywhere. Actually, Amazon is investing money to help every home have access to internet.
Oh and once Amazon takes over the LARGEST customer base in the United States (Pill Poppers) with their new pharmacy model, say goodbye to Wal-Greens too. I really hope that another company can counter this gigantic company before they destroy the classic retail model; however, I am afraid having customers pick-up merchandise will prove to be a fail in the long run.
I will say that Amazons downfall could be taxes in the near future. They have been getting a free pass with that from many states/countries for a long time. If they hit internet companies like Amazon with a 20% tax to protect physical stores, then Amazon may suffer.
This post was edited on 7/2/18 at 8:02 am
Posted on 7/2/18 at 7:55 am to Fasb
i will say...
walmart's online shopping has been a very pleasant experience so far.
just as simple and easy as amazon...but the prices tend to actually be better.
i'd bet on WMT for that reason alone too (referring to OP)
walmart's online shopping has been a very pleasant experience so far.
just as simple and easy as amazon...but the prices tend to actually be better.
i'd bet on WMT for that reason alone too (referring to OP)
Posted on 7/2/18 at 7:58 am to mrgreenpants
My only concern to OP is that Walmart has been doing this for quite a while now and not sure that the stock price increase you are looking for is going to materialize. Already built in gain...
Posted on 7/2/18 at 9:15 am to Fasb
quote:
Sir/Ma'am, you realize that Amazon can bring to your door right? Prime is same day shipping for most products.
And don't forget the conveniece of Alexa.
Posted on 7/2/18 at 9:21 am to SurfOrYak
Saw a story where Wal Mart is now buying up India's leading e- commerce site. Seems like that could have an effect on their stock.
Posted on 7/2/18 at 1:16 pm to Fasb
quote:
Sir/Ma'am, you realize that Amazon can bring to your door right? Prime is same day shipping for most products. Basically, Wal-Mart wants people to drive to their location and pick up their stuff. Why do that? If I'm driving to Wal-Mart, I might as well go inside and do some impulsive shopping. The only people this benefits are people who are too scared to have packages laying outside all day while they are at work and people who drive by Wal-Mart on the way home.
Don't forget that Walmart is still working on using their stores as hubs for local delivery.
Think about it - Walmart essentially has 4000+ warehouses for local delivery, plus their actual DC's. Enlist store personnel for deliveries, even on their way home.
It's still a nut to crack, but the infrastructure is ALREADY there. Something Amazon can't say.
Posted on 7/2/18 at 5:17 pm to I B Freeman
I can see where they are going. Earlier this year in of all places Galliano, LA, Walmart tested the scan and go model. You could use your phone or a handheld scanner. You would bag while you shopped. When done you would scan the register and you would pay and leave. This was a huge time saver.
It was a novel concept, but still needed some work and theft controls.
It was a novel concept, but still needed some work and theft controls.
Posted on 7/3/18 at 1:44 pm to Tarps99
They use this same system in Sam's club locations already. If they're already testing in stores, it should roll out sooner than later.
The online grocery pickup locations are wonderful in Metairie and are a huge advantage versus local stores (Rouse's, Dorignacs). The ability to get food and everything else you can buy in a Walmart in one pickup is huge. Sorry, Dorignacs, no one is going to pay $6 for a gallon of milk anymore once you're aging customers disappear!
I don't shop at whole foods and won't start even though we use Amazon for most nonperishable goods already.
The online grocery pickup locations are wonderful in Metairie and are a huge advantage versus local stores (Rouse's, Dorignacs). The ability to get food and everything else you can buy in a Walmart in one pickup is huge. Sorry, Dorignacs, no one is going to pay $6 for a gallon of milk anymore once you're aging customers disappear!
I don't shop at whole foods and won't start even though we use Amazon for most nonperishable goods already.
This post was edited on 7/3/18 at 1:51 pm
Posted on 7/4/18 at 12:29 pm to GoIrish02
The scan and go system was a trial.
They pulled the scanners out a few weeks go, and it is back to self checkouts.
Heck, I was even more impressed that they had paper bags.
They pulled the scanners out a few weeks go, and it is back to self checkouts.
Heck, I was even more impressed that they had paper bags.
Posted on 7/4/18 at 4:12 pm to Fasb
So does Sams and they do it very quickly to my door step in my small town. Sams was getting over crowded in BR due to other sams closing. Havent been to Sams itself in a few months but still get everything i need fast and free shipping.
Posted on 7/4/18 at 8:14 pm to GoIrish02
If they move same store sales up 1% more than the market expects the earnings impact will be huge.
It is just the first example of something that I see bringing new business to their stores.
It is just the first example of something that I see bringing new business to their stores.
Posted on 7/4/18 at 8:18 pm to I B Freeman
In store pickup isn't exactly anything new or groundbreaking
And there are other stores that actually deliver for cheap enough to where you wouldn't want to go out for something like diapers
And there are other stores that actually deliver for cheap enough to where you wouldn't want to go out for something like diapers
Posted on 7/4/18 at 8:22 pm to Powerman
It is catching on and growing.
When brick and mortar retail standards change the retail leader has every competitive advantage. Pick up is going to be a standard and right now WMT is doing it better than everyone else in implementing the ap and the procedures at the store.
When brick and mortar retail standards change the retail leader has every competitive advantage. Pick up is going to be a standard and right now WMT is doing it better than everyone else in implementing the ap and the procedures at the store.
Posted on 7/4/18 at 10:41 pm to I B Freeman
quote:
right now WMT is doing it better than everyone else in implementing the ap and the procedures at the store.
Kroger marketplace and HEB are doing it better than Walmart in my area. but Walmart may be better for smaller communities without a major grocer.
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