Walmart Inc.Short
What to expect from Walmart. I wouldn't buy if I know this.
There are a lot of people saying about buying now, giving signals like if there is no tomorrow, like if buying stocks is free... I don't see the point in buying anything for the long term right now because of many different reasons:
1. April Consumer Credit +38.07BN, Exp. 35.0BN. The revolving credit increase was 17.8BN. The second-highest on record.
When investors devote too much of their cash to equities in aggregate, the market underperforms over the next ten years. This predicts that stocks will produce lower-than-average returns over the following ten years. While you don't have to shun equities entirely, you should adjust your expectations properly. Alternatively, wait for the stock allocation to drop down considerably before buying, which can happen if the market truly capitulates.
The average stock allocation of investors is presently close to 50%, which is the second-highest level in history. Equity prices will fall over the next decade unless investors maintain a larger stock allocation (which I believe is improbable) - by about 4% each year over the next decade.
2. The US consumer sentiment index from the University of Michigan goes back to 1952. It has never been lower than it is today.
3. Earnings Recession. With the first quarter earnings season nearly complete (97% of companies reported), S&P 500 earnings are down 14% versus Q4 2021 and up less than 1% year-over-year.
4. Critical shortage. The baby formula shortage continues to worsen, with 74% of stores across America out-of-stock (a year ago the rate was less than 5%). 10 US states now have out-of-stocks rates that are 90% or higher, including the most populous state (California).
5. U.S. Inflation
Dec '20: 1.4% (Trump's last full month in office)
Feb '21: 1.7%
Apr '21: 4.2%
June '21: 5.4%
Aug '21: 5.3%
Oct '21: 6.2%
Dec '21: 7.0%
Feb '22 : 7.9% (Putin invades Ukraine)
Apr '22: 8.3%
6. Walmart is making offers in order to sell some stock that they have, which may change the psychology of the clients making them think that the quality is becoming worst and also becoming hard to rise prices in the future.
All these points combined (inflation + shortage + fewer earnings + lower consumer sentiment + people investing money they cannot afford to lose) make me think that investing in Walmart right now can be an 8-10 years trap where you would lose even less by just leaving your money under your bed.
7. The technical analysis neither seems good as you can see. With all these conditions is something expectable that Walmart goes at least to the 61.8 Fibonacci level or even to 55$ per share...
This is not a recommendation for buying or selling, this is just an analysis to make people have a more global vision before falling into the traps of the people that invite you to buy at this level.
1. April Consumer Credit +38.07BN, Exp. 35.0BN. The revolving credit increase was 17.8BN. The second-highest on record.
When investors devote too much of their cash to equities in aggregate, the market underperforms over the next ten years. This predicts that stocks will produce lower-than-average returns over the following ten years. While you don't have to shun equities entirely, you should adjust your expectations properly. Alternatively, wait for the stock allocation to drop down considerably before buying, which can happen if the market truly capitulates.
The average stock allocation of investors is presently close to 50%, which is the second-highest level in history. Equity prices will fall over the next decade unless investors maintain a larger stock allocation (which I believe is improbable) - by about 4% each year over the next decade.
2. The US consumer sentiment index from the University of Michigan goes back to 1952. It has never been lower than it is today.
3. Earnings Recession. With the first quarter earnings season nearly complete (97% of companies reported), S&P 500 earnings are down 14% versus Q4 2021 and up less than 1% year-over-year.
4. Critical shortage. The baby formula shortage continues to worsen, with 74% of stores across America out-of-stock (a year ago the rate was less than 5%). 10 US states now have out-of-stocks rates that are 90% or higher, including the most populous state (California).
5. U.S. Inflation
Dec '20: 1.4% (Trump's last full month in office)
Feb '21: 1.7%
Apr '21: 4.2%
June '21: 5.4%
Aug '21: 5.3%
Oct '21: 6.2%
Dec '21: 7.0%
Feb '22 : 7.9% (Putin invades Ukraine)
Apr '22: 8.3%
6. Walmart is making offers in order to sell some stock that they have, which may change the psychology of the clients making them think that the quality is becoming worst and also becoming hard to rise prices in the future.
All these points combined (inflation + shortage + fewer earnings + lower consumer sentiment + people investing money they cannot afford to lose) make me think that investing in Walmart right now can be an 8-10 years trap where you would lose even less by just leaving your money under your bed.
7. The technical analysis neither seems good as you can see. With all these conditions is something expectable that Walmart goes at least to the 61.8 Fibonacci level or even to 55$ per share...
This is not a recommendation for buying or selling, this is just an analysis to make people have a more global vision before falling into the traps of the people that invite you to buy at this level.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.