Wal-Mart Stores Inc's US same-store sales have fallen for two straight years, as customers struggle with high unemployment and wages that are not keeping up with rising prices for food and other basics. The world's largest retailer's breadth offset the impact of the US slump, as strong sales at its warehouse clubs and international stores, cost-cutting and share repurchases helped it post a better-than-expected 3.8 percent rise in profit.
"The risk/reward ratio on Wal-Mart stock is constantly improving, despite the painful US experience over the last two years, " said Gilford Securities analyst Bernard Sosnick. Wal-Mart's shares, up about 4 percent since the beginning of the year, skidded 1.1 percent to $55.49 on Tuesday.
Wal-Mart is steadfast about fixing its sales at US stores open at least a year. It is widening its assortment of goods and emphasising low prices to woo back customers who chose to shop elsewhere, including grocery and dollar stores. Its core US shoppers are still on a budget and have concerns about rising gas, energy and food prices, as well as employment issues. At the same time, small business owners who shop at its Sam's Club warehouse stores remain concerned about the economy and their access to credit. US same-store sales fell 1.1 percent, in line with the company's forecast of a drop of 2 percent to flat, and slightly better than the average 1.3 percent decline expected by analysts according to Thomson Reuters.
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