Earnings reports can be telling.
They can show whether a company is on the right track with its business model…
Or they can tell whether or not a shift is needed in a business strategy in order to help turn things around.
It shows whether or not a company has adapted to the market…
Or needs to adapt – and if Walmart’s recent earning report is any indication – it may want to adapt in order to survive the shifting winds of our current markets because it’s evident that things are off.
How off are they?
Well, enough that it’s triggered a 23% stock slide (as of this writing).
That’s BIG…
But that’s not the question we really want to know the answer to.
No, the real question is: what was the catalyst for this HUGE drop?
The answer may surprise you, because it’s probably not what you think.
Look, we understand that there are a lot of hurdles facing Americans – not just American investors…
With inflation at the highest point in decades, gas prices through the roof and a market that doesn’t seem to want to stick to an identity – things are a little weird out there right now – but that doesn’t mean that we can’t make money.
The biggest secret on Wall Street is this…
Even when things look to be at their bleakest – there are STILL people getting rich from stocks.
This is why GorillaTrades was created…
To make money REGARDLESS of the conditions of the market.
But we’re not here to talk about how GT can help you profit even during the worst of times…
We’re here to talk about Walmart and why its earnings were 25% LOWER than they were last year at the same time.
For many companies that seem to be at a loss this year over last…
A lot of that has to do with the end of the pandemic – as people are able to move out and about more freely – allowing them more diverse choices for the goods they buy.
Many of the “big” name retailers’ profits have been propped up over the past couple of years due to the fact that the lockdowns forced people to shop from home with very few choices…
However, with the US opening back up – those focused profits are being distributed amongst other businesses – so, that’s definitely a factor.
However, this Q1 shortcoming may be due to the old adage of Walmart’s eyes being bigger than it’s stomach.
What am I talking about?
Well, getting ready for spring, the retailer stocked up on spring time supplies – such as grills, sprinklers, pool floats and the like – only for 2022 to produce one of the wettest springs of the last decade.
On top of that…
The company found itself overstaffed as well – as workers who had reduced their hours do to COVID were ready to come back to work…
That left Walmart with higher labor costs – all of which create the perfect storm for a 25% drop in profit from the same time last year.
That said…
Since it doesn’t seem like inflation and higher costs are going anywhere anytime soon – the company decided to cut its profit outlook for the rest of the year as well.
Now, the 23% stock price drop makes sense, doesn’t it?
Here’s the thing, though, and what investors need to keep in mind…
As the world’s biggest retailer – Walmart is a “go to” for economists trying to understand how Americans are handling economic changes – and change is definitely here.
How do we know? Well, the fact that Walmart revealed that customers bought more of its own-brand products and fewer discretionary goods like games, electronics and clothing – is a telltale signs of high inflation.
Take this as a warning shot across our bow…
Things could get a little rough in the next coming months – which is what makes GorillaTrades more important than ever.
Our recommendations are based SOLELY on hard data and real numbers – there is no guess work or assumptions – every GT pick is based on the stocks quantifiable value…
It’s the safest way to invest when things are getting… well, weird out there.
We’d love to have you along for the ride…
But understand that some people would rather go it alone.
If that’s you – just understand that the problems facing Walmart are facing EVERYBODY…
If you find yourself lost – let us know – we’re here to help!
“There is only one boss. The customer. And he can fire everybody in the company from the chairman on down, simply by spending his money somewhere else.” – Sam Walton
