Walmart Inc. : The USD 74.9 area might facilitate a technical rebound
May 28, 2015 at 03:20 pm
By
Share
BUY
Entry price
Target
Stop-loss
Potential
US$75.19
US$0
US$73.53
-100%
In the past few sessions, Wal-Mart Stores share have suffered from a sharp fall and is now coming back to significant level support.
From a fundamental viewpoint, Wal-Mart Stores seems undervalued in terms of enterprise value. Based on the current price, its market capitalization, plus its net debt, represents 0.58 times its revenues.
Its P/E ratio are low at 15.71 and 14.96 times the two next years earnings.
Technically, in daily data, even if moving averages are still in a downtrend, a positive reaction in the USD 74.9 area should stop this trend and allow a technical rebound towards USD 77.65/79.9. Moreover, technical indicators show a significant oversold condition which strengthens this bullish scenario.
Therefore, the proximity of the USD 74.9 support is an opportunity to go long on Wal-Mart Stores. The first goal is a return in the USD 79.9 resistance area, that is a potential of 6.9%. A stop loss order can be placed under the support currently tested.
Walmart Inc. is the world's leading distribution group. Net sales break down by activity as follows:
- distribution in the United States and Porto Rico (83.3%): this activity is performed, at the end of January 2023, through the following names: Wal-Mart (83.3% of net sales; reduced-price retail distribution; 4,717 outlets, of which 3,572 supermarkets, 364 discount outlets, and 781 convenience stores), and Sam's Club (16.7%; 600 warehouses accessible to members only in the United States);
- international distribution (16.7%): 5,306 points of sales located in Mexico (2,862), Central America (882), China (365), Africa (375), Canada (402), Chile (392) and India (28).