Fourth-quarter net income actually dropped 7.4% to $3.79 billion. Wal-Mart's profit was hit by unfavorable currency exchange rates and a charge to settle litigation. Total revenue ticked up a mere 1.7% to $108 billion. Same-store sales increased 2.8% without fuel.
Wal-Mart did manage to beat analysts' expectations with its earnings, which these days, goes a long way with many investors. However, it missed revenue expectations and gave cautious guidance. Of course, there's an argument that any consumer-facing company that isn't releasing cautious guidance may be more than a bit disconnected with reality.
Wal-Mart's quarter may not inspire euphoria, but still, it was a decent quarter in times that are tough even for discounters. Costco
Wal-Mart, a Motley Fool Inside Value pick, remains one of the solid stocks investors should consider buying and holding despite the major economic problems we face. Investors would do well to avoid many retail stocks; for example, consider middle-of-the-road department stores like Macy's
Despite the company's ability to perform, the price of Wal-Mart shares has actually dropped 17% in the past six months, giving investors a more tantalizing price to get in. It's trading at 14 times earnings, which may seem like a premium compared with, say, Target's price-to-earnings ratio of 9. But still, Wal-Mart's been able to excel in this ugly climate, which implies it's worth a premium. Meanwhile, it's a dividend payer, too. Investors could do a heck of a lot worse than Wal-Mart in their portfolios.