Much of the narrative around Wal-Mart (NYSE:WMT) in recent years has been its push into more international markets. Now, the company has announced that it will be opening 50 new stores across India. On today's Stock of the Day, Motley Fool analyst Michael Finarelli notes that while Wal-Mart has spent quite a lot to make this highly touted international push, the returns from the effort thus far have dramatically lagged returns from its domestic business due to much thinner margins in other markets.

In the video, Mike breaks down the numbers for investors, showing the enormous percentage of operating income generated from overseas operations that the company spent on capital expenditures to build out and operate its overseas footprint over the trailing-12-month period ending this January. Based on this and the thinner margins abroad leading to dramatically less operating income from international operations, Mike says he would much rather see the company continue to focus on a strategy of leveraging domestic operations.

So is Wal-Mart a buy ahead of this expansion into India? Mike says he's staying away for now. He isn't a fan of this strategy and says these capital allocation decisions concern him. And with the ever-increasing threat of competition from Amazon.comĀ or Costco, he's just not interested in Wal-Mart today.

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Mark Reeth and Michael Finarelli have no position in any stocks mentioned, and neither does The Motley Fool. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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