Judging by Wal-Mart's
Wal-Mart's net income increased 7.9% to $2.86 billion, or $0.70 per share. Sales increased 8.8% to $90.9 billion. Same-store sales increased 1.5%, including fuel sales. Its long-term debt is up 25%, and cash and equivalents are down 16%. Granted, Wal-Mart's quarter was better than Wall Street expected, which often leads to euphoric interludes. On the other hand, Wal-Mart's successful quarter included an iron grip on containing costs and inventory.
It fits well with my Foolish colleague Seth Jayson's October article, "Retail in Fantasyland." He pointed out how easy it is to misconstrue Wal-Mart's recent numbers as signals of consumer strength when, in fact, given Wal-Mart's reputation for rock-bottom prices, maybe they're a better sign that consumers are actually feeling pinched right now.
Meanwhile, a gaggle of retailers' stocks are up by ridiculous percentages today. Long-beleaguered retailer Hot Topic
Personally, I'm still hesitant on Wal-Mart for several reasons. First of all, it has its public image and strategy to work on as the retail landscape evolves. It faces very smart discount retail competition from the likes of Target
Then there's the big picture: When it comes to the retail landscape, investors who aren't looking long and hard for the best, most well-run retailers that have sustainable competitive advantages and are trading at reasonable prices may end up holding some empty shopping bags.
More Wal-Mart Foolishness: