Log in
E-mail
Password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
Settings
Settings
Dynamic quotes 
OFFON

4-Traders Homepage  >  Equities  >  Nyse  >  Wal-Mart Stores Inc    WMT

SummaryQuotesChartsNewsAnalysisCalendarCompanyFinancialsConsensusRevisions 
News SummaryMost relevantAll newsSector newsTweets 

Hedge fund short-sellers to target Wal-Mart Mexico

share with twitter share with LinkedIn share with facebook
share via e-mail
0
04/23/2012 | 01:21pm CET

Hedge fund managers are bracing for selling pressure in shares of Wal-Mart Stores Inc on Monday, but market experts said it is the retail giant's less visible Mexican unit that could be the more attractive target for short sellers.

The New York Times reported on Saturday that Wal-Mart de Mexico, which is 69 percent owned by Wal-Mart Stories Inc, had orchestrated a widespread bribery campaign in 2005 to win market dominance. The investigative article alleged that senior Wal-Mart executives knew about the matter and tried to cover it up.

"I would not consider Wal-Mart shares expensive, but I definitely would not be a buyer at these levels in the 60s. I'm more interested in shorting the Mexico traded 'pure play,'" said private activist investor Daniel Yu, who has presciently shorted such stocks including Green Mountain Coffee Roasters Inc and Sino-Forest Sino-Forest Corp.

Wal-Mart said in a statement on Saturday that it was "deeply concerned" about the allegations in the Times report and began an investigation into its compliance with anti-bribery laws last autumn.

Analysts said Wal-Mart could be forced to devote millions of dollars and enormous amounts of manpower to the investigation, which could eventually cost some top executives their jobs.

Major institutional investors said Wal-Mart shares might face selling pressure in the near term, especially since the stock has risen about 17 percent in the past 12 months to $62.45, outperforming the S&P 500 index's 3 percent rise.

"You might find a little short-term pressure on the Wal-Mart stock, but I would not expect any long-term effect," said Kenneth Polcari, managing director at ICAP Equities in New York.

Short interest on the stock is very low. According to Data Explorers, which tracks short interest, just 0.5 percent of all shares are being borrowed for short sales, a very low figure.

John Marshall, a senior markets analyst for the United Food and Commercial Workers capital stewardship program, wonders if there will be lawsuits being brought on behalf of shareholders.

He said shareholders are going to want to know if the board was actively managing risk. "Either they were actively doing their job and fulfilling their responsibility to be managing that risk and they were lied to and the facts were being kept from them -- or they weren't. And that would be a bigger problem ... This is clearly an area of risk that the board should have been on top of."

Marshall is not a Wal-Mart shareholder, but UFCW funds own Wal-Mart shares through broad equity indexes that they participate in on behalf of more than 1 million members.

Wal-Mart de Mexico, better known as Walmex, closed on Friday at 43.06 pesos, after gaining steadily since August of last year when they were just under 30 pesos.

Walmex is due to report results on Monday. Mexico's largest retailer is expected to report a 14.1 percent increase in first-quarter profit, helped by a broad pickup in consumer spending as well as aggressive promotions that boosted sales.

Walmex has expanded rapidly since Wal-Mart opened its first store outside the United States in Mexico City in 1991, then part of a joint venture. In 2011, the Mexican unit reported total sales of 379 billion pesos ($29 billion). Walmart's fiscal 2012 sales, for the year ended January 31, were $443.85 billion.

(Additional reporting by Jessica Wohl, Editing by Tiffany Wu and Diane Craft)

By Jennifer Ablan and David Gaffen

Stocks treated in this article : Wal-mart de Mexico S A B de C V, Wal-Mart Stores, Inc.
share with twitter share with LinkedIn share with facebook
share via e-mail
0
Latest news on WAL-MART STORES INC
03/24 WAL MART STORES : More big brands pull ads from YouTube in widening boycott
03/24 WAL MART STORES : Two Defendants Sentenced in Opioid Pill Mill Case
03/24 WAL MART STORES : U.S. Patents Awarded to Inventors in Arkansas (March 24)
03/24 WAL MART STORES : The Center for Strategic and International Studies (CSIS) - Di..
03/24 WAL MART STORES : Northwest Arkansas clocks in at No. 22 for fast-growing U.S. m..
03/24DJWAL MART STORES : Health-Data Watchdog Company Has a Powerful Adviser
03/24 WAL MART STORES : Eight defendants to be convict on drug charges
03/24 VERITEQ : CEO Releases Letter to Shareholders
03/24 WAL MART STORES : Scenery Hill woman accused of fraudulently getting prescriptio..
03/24 WAL MART STORES : SimpleFund Mobile Fundraising App Helps Local Youth Hockey Tea..
More news
Sector news : Supermarkets & Convenience Stores
03/24 ARYZTA : Rothschild wins mandate to study options for French food chain Picard
03/24DJMAJEDIE ASSET MANAGEMENT LTD MAJEDIE : Form 8.3 - Tesco Plc
03/24DJTESCO : Investec Bank plc Form 8.5 (EPT/RI) - Tesco Plc
03/23DJMAJEDIE ASSET MANAGEMENT LTD MAJEDIE : Form 8.3 - Tesco Plc
03/23DJMAJEDIE ASSET MANAGEMENT LTD MAJEDIE : Form 8.3 - Tesco Plc
More sector news : Supermarkets & Convenience Stores
News from SeekingAlpha
03/24 The View From The Top
03/24 WSJ : YouTube ad issue persists, PepsiCo, Wal-Mart Stores, General Motors, Starb..
03/23 How To Invest A Lumpsum Amount Of Money In An All-Time High Stock Market
03/21 Alibaba Acquires Damai For Entertainment Boost
03/21 'Amazon Go' May Be A 'No Go,' Thus Selling Into The Stock's Big Mo
Advertisement
Financials ($)
Sales 2018 495 067 M
EBIT 2018 22 347 M
Net income 2018 13 109 M
Debt 2018 39 121 M
Yield 2018 2,97%
P/E ratio 2018 16,10
P/E ratio 2019 15,22
EV / Sales 2018 0,51x
EV / Sales 2019 0,50x
Capitalization 214 693 M
More Financials
Chart WAL-MART STORES INC
Duration : Period :
Wal-Mart Stores Inc Technical Analysis Chart | WMT | US9311421039 | 4-Traders
Full-screen chart
Technical analysis trends WAL-MART STORES INC
Short TermMid-TermLong Term
TrendsNeutralBullishNeutral
Technical analysis
Income Statement Evolution
More Financials
Consensus
Sell
Buy
Mean consensus HOLD
Number of Analysts 36
Average target price 74,2 $
Spread / Average Target 6,3%
Consensus details
EPS Revisions
More Estimates Revisions
Managers
NameTitle
C. Douglas McMillon Chief Executive Officer & Director
John Furner President
Gregory B. Penner Non-Executive Chairman
Michael J. Bender Chief Operating Officer-Global eCommerce
Brett M. Biggs Chief Financial Officer & Executive Vice President
More about the company
Sector and Competitors
1st jan.Capitalization (M$)
WAL-MART STORES INC0.71%214 693
ALIMENTATION COUCHE TA..-3.22%25 430
CARREFOUR-5.59%17 590
DAIRY FARM INTERNATION..28.67%12 375
WHOLE FOODS MARKET, IN..-5.95%9 302
CENCOSUD SA--.--%8 692
More Results