If investors were bummed by today's overall retail sales data for July, Wal-Mart's
Wal-Mart's second-quarter net income fell 0.2% from last year to $3.44 billion, or $0.88 per share -- a slight uptick on a per-share basis. Earnings also suffered a $0.04-per-share hit from currency exchange rates.
Wal-Mart's revenue wasn't so impressive, either; net sales dipped 1.4% to $100.08 billion. Same-store sales fell 1.2% without accounting for fuel sales, and fell 1.9% with it. That's a far cry from this time last year, when same-store sales rose by more than 4%. I guess consumers' love for Wal-Mart just isn't enough these days.
Wal-Mart admitted that the sales environment was more difficult than it had previously expected. While it was able to raise its guidance for the year, expect Wal-Mart to start pursuing the same sort of cost cuts keeping many companies afloat. The megaretailer said it expects same-store sales to be anywhere from flat to up a mere 2% in the current quarter.
This earnings season, many companies have exceeded analysts' profit expectations, even with uninspiring sales. Starbucks
Last quarter, even Costco
As investors' exuberance reaches arguably irrational levels, some retail stocks -- J. Crew
Instead, Fools should carefully seek out quality retail investments. Venerable discount names such as Wal-Mart, Costco, and cheap eats expert McDonald's
Wal-Mart Stores, Costco Wholesale, and Starbucks are Motley Fool Inside Valueselections. Costco and Starbucks are Motley Fool Stock Advisor selections. The Fool owns shares of Costco and Starbucks. Try any of our Foolish newsletters free for 30 days.