Today’s Research Reports on Stocks to Watch: Costco Wholesale Corporation and Wal-Mart Stores, Inc.
Shares of Walmart headed slightly higher on Thursday despite negative news about its Sam’s Club closing 63 lo cations across the U.S. The market was also reacting to the company announcement that due to the tax overhaul, it would be raising its wages to $11 an hour and giving employees bonuses. Shares of Costco surged over 2% on the news of the Sam’s Club closings.
RDI Initiates Coverage on:
Wal-Mart Stores, Inc.
Costco Wholesale Corporation
Wal-Mart Stores, Inc. shares closed up a modest 0.35% on Thursday after Wall Street learned about several developments. The biggest headline involving Walmart has been the fact that its Sam’s Club would be closing over 60 stores across the country with thousands of employees potentially being affected. Walmart is planning to cut about 10,000 jobs. After the closings, Sam’s Club will still have 597 locations open. Many were shocked by the sudden news on Thursday. Sam’s Club CEO John Furner said to The Street, "We have taken a really hard look at the real estate portfolio and decided to exit clubs that cannot, or will not, be successful under our new strategy and in some cases — historically have not been. Some of the places we are exiting today have geographies with low population or geographies with more clubs than the market will support." In more positive news, Walmart also announced that it would be raising its hourly pay to $11 for all of its workers in the U.S. Employees would also be eligible for one-time bonuses. The company’s CEO Doug McMillon cited the tax overhaul for the pay increase.
Access RDI’s Wal-Mart Stores, Inc. Research Report at:
Costco Wholesale Corporation shares closed up 2.14% on Thursday with almost 4.7 million shares traded. It was a day of gains for the retailer that sells things in bulk after rival Walmart’s Sam Club revealed that it would be closing many Sam’s Club locations. Walmart said to Business Insider that it would be closing 63 Sam’s Clubs in the nation. Sam’s Club said on its Twitter that the decision to "close a series of clubs and better align our locations with our strategy." Sam’s Club CEO John Furner said in a letter to Sam’s Club employees, "After a thorough review, it became clear we had built clubs in some locations that impacted other clubs, and where population had not grown as anticipated." Many Sam’s Clubs employees had no idea about the closings until Thursday. According to Business Insider, up to 10,000 employees could be affected and as many as 10 of the closing stores would be turned into e-commerce distribution centers.
Access RDI’s Costco Wholesale Corporation Research Report at:
Our Actionable Research on Costco Wholesale Corporation (NASDAQ:COST) and Wal-Mart Stores, Inc. (NYSE:WMT) be downloaded free of charge at Research Driven Investing.
Research Driven Investing
We are committed to providing relevant and actionable information for the self-directed investor. Our research is reputed for being a leader in trusted, in-depth analysis vital for informed strategic trading decisions. The nimble investor can leverage our analysis and collective expertise to execute a disciplined approach to stock selection.
RDInvesting has not been compensated; directly or indirectly; for producing or publishing this document.
Disclaimer: This article is written by an independent contributor of RDInvesting.com and reviewed by Nadia Noorani, CFA® charter holder. RDInvesting.com is neither a registered broker dealer nor a registered investment advisor. For more information please read our full disclaimer at www.rdinvesting.com/disclaimer.
For any questions, inquiries, or comments reach out to us directly at:
Research Driven Investing, Unit #901 511 Avenue of the Americas, New York, NY, 10011
CFA® and Chartered Financial Analyst® are registered trademarks owned by CFA Institute.