This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Is the Walmart New U.S. CEO Right for the Job?

Stocks in this article: WMT

NEW YORK (TheStreet) - Walmart's (WMT) announcement Thursday that Bill Simon, CEO of Walmart U.S., is leaving the company and the world's largest retailer garnered mixed reactions by the analyst community.

Wall Street was generally unsurprised that Simon is leaving -- chatter that his departure may have been over disappointment at being passed up for promotion as Walmart's CEO earlier this year with the company instead choosing its international head, Doug McMillon. However, analysts seemed curious about Walmart's decision to pass over those underneath Simon to replace him, instead naming an executive who had been heading up its China and greater Asia operations.

Greg Foran, 53, Walmart's head of its operations in Asia, is replacing Simon, and his experience is "primarily outside the U.S.," Deutsche Bank analyst Paul Trussell wrote in a research note. "In our view, this presents a substantial learning curve and showcases a clear change in direction of the division, for him to successfully bypass all of Bill's lieutenants such as Chief Merchandising Officer, Duncan Mac Naughton."

Walmart Axes Its Fumbling U.S. Chief

How Walmart Is Eyeing Silicon Valley

Why Walmart Still Has a Big Opportunity Online

That said, the change in management "presents an opportunity for WMT to think differently about how it positions itself for the future of retailing," Trussell penned in the note. "These changes may include a substantial reduction in supercenter store openings and a focus on e-commerce and small stores, which we note would be a long-term positive for shares (but negative for dollar stores, grocery, and other discounters). Near-term, there is concern that 2Q results may once again be lackluster."

Walmart shares were falling 0.80% to $76.38 on Thursday.

Walmart is under pressure, as sales in its U.S. business have been struggling. The discount retailer said in May it expects U.S. comps for the second quarter to be "relatively flat." Under Simon, the unit has been making investments in its e-commerce business and placing focus on building smaller stores. Walmart reports fiscal second quarter earnings on Aug. 14. Analysts, according to Thomson Reuters, expect the company to report earnings of $1.21 a share on revenue of $119 billion, up just 2% year over year.

Foran will start his new position on August 9. Simon will be available as a consultant for six months to assist with the transition.

"Foran is not well known by Wall Street," wrote Faye Landes, an analyst with Cowen & Co., in a note to clients. "Foran joined the company recently - October 2011 - and has been working in Asia. He was appointed as head of Asia at the end of April 2014, implying that this most recent move was not in the works at that point. We will probably never know the backstory on this - it seems likely that the company knew or at least strongly suspected that Simon would leave, but maybe they originally had someone else in mind as head of U.S." In a press release earlier Thursday, Walmart cited Foran's experience citing him as a "35-year retail veteran."

1 of 2

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 17,356.87 +288.00 1.69%
S&P 500 2,012.89 +40.15 2.04%
NASDAQ 4,644.3120 +96.4780 2.12%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs