BehindBlueI's
Grandmaster
- Oct 3, 2012
- 26,608
- 113
http://www.marke****ch.com/story/wal-mart-cuts-outlook-as-profit-falls-short-2015-08-18-74855124
One of the many reasons sighted for reduced profits were increased wages. Many on INGO seem to believe that increased wages result in increased prices, as though a business has free reign to increase prices as they see fit. In a competitive environment, this isn't the case of course, but here's further proof.
So, about 24 cents per share is for increased wages and increase hours. Per Wal-mart themselves, additional hours is the "primary driver" of that figure. In short, they underestimated how many man-hours their growth plan was going to take. In comparison, currency fluctuations are eating 13 cents per share. Overestimating what the pharmacies would make and shrinkage (more on that later) are eating 11 cents per share. Note that none of this is a loss, its a reduction from previous estimates. Earnings per share are still estimated at $4.40-$4.70)
They also repurchased $1 Billion of their own stock. Dividends for the quarter were $1.6 Billion. (about half of which goes to the Waltons)
Also interesting are ongoing allegations that "shrinkage" is being manipulated along the chain. Inventory that is on the books is not physically in stores. Wal-mart is pleading ignorance if this is to theft, logistics issues (misplaced items in warehouses, misdelivered items), or playing with the books by store managers and others attempting to write off out-of-date merchandise.
Anyway, more money in the pockets of the lowest income workers has not hurt the business in any significant way and has not impacted consumers. It does bring up the question of why we continue to allow corporate welfare to subsidize them, though, doesn't it?
**EDIT**
Apparently the swear filter doesn't like "market watch" without the space, so I can't link to the article. Here's Wal-mart's press release: http://stock.walmart.com/files/doc_financials/2016/Q2/FY-16-Q2-press-release-final.pdf
One of the many reasons sighted for reduced profits were increased wages. Many on INGO seem to believe that increased wages result in increased prices, as though a business has free reign to increase prices as they see fit. In a competitive environment, this isn't the case of course, but here's further proof.
So, about 24 cents per share is for increased wages and increase hours. Per Wal-mart themselves, additional hours is the "primary driver" of that figure. In short, they underestimated how many man-hours their growth plan was going to take. In comparison, currency fluctuations are eating 13 cents per share. Overestimating what the pharmacies would make and shrinkage (more on that later) are eating 11 cents per share. Note that none of this is a loss, its a reduction from previous estimates. Earnings per share are still estimated at $4.40-$4.70)
They also repurchased $1 Billion of their own stock. Dividends for the quarter were $1.6 Billion. (about half of which goes to the Waltons)
Also interesting are ongoing allegations that "shrinkage" is being manipulated along the chain. Inventory that is on the books is not physically in stores. Wal-mart is pleading ignorance if this is to theft, logistics issues (misplaced items in warehouses, misdelivered items), or playing with the books by store managers and others attempting to write off out-of-date merchandise.
Anyway, more money in the pockets of the lowest income workers has not hurt the business in any significant way and has not impacted consumers. It does bring up the question of why we continue to allow corporate welfare to subsidize them, though, doesn't it?
**EDIT**
Apparently the swear filter doesn't like "market watch" without the space, so I can't link to the article. Here's Wal-mart's press release: http://stock.walmart.com/files/doc_financials/2016/Q2/FY-16-Q2-press-release-final.pdf