Factors to Consider
Technical indicators provided by BarchartA recent price weakness can signal a buying opportunity for those who have been sitting on the sidelines or want to add to their positions in stocks that are fundamentally sound. The weak 16% Barchart technical buy signal and a Trend Spotter sell signal could be what you've been waiting for. Although the stock is trading below its 20-day moving average, it is still above its 50- and 100-day moving averages. The stock fell 2.6% in the last month but was up 10.51% for the quarter and has increased by 36.5% in the past year. The Relative Strength Index is still above 50% at 50.63%, and Barchart computes a technical support level at $71.88. The stock recently traded at $72.62 with a 50-day moving average of $72.50
Fundamental FactorsThe 20 Wall Street brokerage firms that follow the stock have assigned 29 analysts to make recommendations. They project revenue will increase again this year by a rate of 5.70% and another 5.00% next year. Earnings are estimated to increase by 9.6% this year, an additional 8.9% next year and continue to increase annually by 8.4% for at least five years. The price-to-earnings ratio of 15.4 is marginally higher than the market P/E ratio of 15.0. The dividend of 2.20%, which is about one-third of estimated earnings, is right near the market dividend rate of 2.3%. The balance sheet is solid and receives an A++ financial strength rating. Wal-Mart continues to control costs and growth and looks to keep on track building new and smaller Wal-Mart Expresses.