Monday, May 24, 2010


WMT is reaching an area in which could be worth to take a look. The stock market is very oversold, and may be WMT is a good opportunity to play the rebound if this one finally arrives. Notice how the 38.2% fibonacci retracement from the September 2008 highs coincides with the 50% fibonacci retracement from the March 2010 highs.

But WMT it is not interesting solely based on it charts. The fundamentals are good too.


- The sales of this giant had been increasing since 2008, the subprime crisis does not push them into negative zone. They have increased 7.8% between 2008 and 2010 (3.9% annual growth). In this same term, the EPS is up 9%.
- The current divindend yield after taxes is 1.4%, with an average divindend growth in the last 3 years of 5.9%. This give us a discounted cash flow of 37 USD (one of the highest in the DOW JONES) with an 8% risk rate and 6.42% using CAPM (0.25 beta and 3.73% risk free rate)

Weekly chart:

Daily chart:

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