Recently, a couple of Arkansas newspapers published articles about the rumored resignation of Lee Scott, president and CEO of Wal-Mart Stores (NYSE:WMT). Scott even joked about it a little bit at the company's annual meeting last Friday. The MorningNews of Springdale first published the story, and the Arkansas Democrat-Gazette followed up with its own report.

What got the rumor mill running? His assistant was seen boxing up some books and moving shelves out of Scott's office. Apparently, it doesn't take much to get the talk going around the water cooler.

And why shouldn't people think Scott might want to quit? The company is embroiled in scandal at the executive level. Lawsuits and federal investigations seem to be as common as the chorus of beeping from its cash registers. All of this while competitors Target (NYSE:TGT), Sears Holdings (NASDAQ:SHLD), and Kohl's (NYSE:KSS) are enjoying very nice stock gains. Wal-Mart, meanwhile, is trading at a lowly 19 times earnings, with shares at about $47 each.

And what about the pitiful financial performance? Sales for the first quarter of fiscal 2006 were only $70.1 billion, vs. $64.8 billion for the same period in fiscal 2005. Shameful!

Earnings for the 12 months ended April 30 were $2.49 per share. This was only 17% greater than the previous 12-month period. The company posted a disgraceful 23.6% return on equity. Scott should be ousted!

Oh, wait a minute. Maybe I got that wrong. Wouldn't most Fools consider this kind of performance good? And isn't this the company that has produced record sales and record earnings every year since, well, always?

Maybe this is one of those times when Mr. Market is having one of his manic-depressive mood swings. Don't get me wrong -- lawsuits and allegations of executive wrongdoing are bad. But isn't everyone overreacting just a bit? The stock is trading at 19 times earnings! The last time Wal-Mart traded at a P/E of less than 20 was in 1996, when the stock was in the $12 range. Even with the recent decline, that's a 16% compounded annual return for investors who have held on since then.

Hmmm. Growing sales, growing profits, and the stock trading at a P/E reminiscent of the mid-'90s. I think this might actually be one of those famed "buying opportunities."

By the way, Scott denies those resignation rumors and plans on sticking around. I don't know about you, but I'm glad he's doing so. I believe Wal-Mart's got a lot of great days ahead of it, and I'm glad he'll be at the helm. Maybe the stock market will also recognize this soon.

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Fool contributor Adam Kees owns shares of Wal-Mart but none of the other companies mentioned. He would love to hear your opinion. The Motley Fool has a disclosure policy.