Credit Analysis on Wmt

In: Business and Management

Submitted By pedrozanotelli
Words 1497
Pages 6
PEDRO Z ANO T E L LI

F I X E D I N C O M E R ESE A R C H

W M T 4.25% 4/15/2021

RATIONALE

Wal-Mart is a recommended BUY due to its competitive advantage against peers in the industry, good capital structure (good management), and relatively good ratios for profitability, solvency and liquidity. The company is the biggest company in North America and expanding more year by year. It carries a wide product assortment and in lower costs against any other company in the industry; keeping favorable pricing from and systematic integration with most of its suppliers.
COMPANY DESCRIPTION

Wal-Mart divided into three divisions: Wal-Mart U.S. (FY 12 (Jan.) sales $264.2 billion), Sam's Club ($53.8 billion), and Wal-Mart International ($125.9 billion). Wal-Mart operates a chain of over 10,000 discount department stores, wholesale clubs, supermarkets and supercenters. They also offer its products through various e-commerce websites. They are the best-positioned to address the needs of customers around the world. Over 100 million costumers visit Wal-Mart stores worldwide each week; the company is a dominant player in many of the markets in which it competes. Their customers remain pressured, particularly in mature markets, about job security and personal finances. In emerging countries, the economic recovery is stronger and fueling a growing middle class. With FY 12 sales of about $145 billion within supermarket-related categories (grocery), the WalMart U.S. division is the largest supermarket operator in the U.S., commanding nearly 30% of $500 billion-plus supermarket industry. Other major product categories within the Wal-Mart division include entertainment ($32 billion in sales in FY 12), hardline ($26 billion), health and wellness ($29 billion), apparel ($18 billion), and home ($13 billion). Sam's Club is the second largest warehouse club in the U.S., with sales…...

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