WMT: To buy or not to buy?

[Main Street Stock Investor]

(10-19-2015, 12:12 PM)Dividendsrule Wrote: I appreciate your article, and I appreciate your posting your point of view, Eric.

I think I am attracted to the "big boats", and I don't mind waiting until WMT accomplishes what they want to achieve. I want to get in on big retail without buying AMZN...And I like the tried and true WMT model, with their willingness to (try to) evolve into the future. You, and others are emphasizing a lack of growth, but I think I am more lenient...There have been periods of low growth in many of the blue chips on the DGI list, but that wasn't a reason to sell, in my opinion. As I recall there were a few years in a row in the 1980s when PG only raised the dividend a couple of percentage points a year.

If a person literally thinks there will be a structural change, that would probably be a reason to sell. Like for instance, let's say there was a glove that allowed people to wipe themselves in the bathroom, eliminating a large part of KMB's revenue stream. I am seeing WMT try to innovate to be a part of the future...Or, there might be a structural change killing their business, arguably?

So to your argument, with the churn and commoditization in telephony I could see T growth muted at 4-5%, plus all of their debt, and O can only grow as fast as they acquire more leases and raise rents, probably 4-5% long term max, but when WMT rights their ship again and figures out how to eat into AMZN, I could see double digit raises again (I hope). Plus when inflation really hits in a number of years in the future, and they can raise the prices and margins. Obviously "hope is not a strategy" but that is my thesis at this time.

EDIT: Lest we forget, lots of buybacks in the next couple of years too should boost dividend growth capabilities.

Again I appreciate your perspective.

Does anyone here think that WMT is an obsolete old dinosaur and absolutely going the way of the Dodo?

Dividends Rule,

IMO, I don't think WMT is irrelevant. It is a dividend aristocrat and a dividend achiever and I don't think it will lose that status any time soon. I own and trade WMT. Owned it for 20+ years. If I was taking a new position today, I would buy 1/3 of a full position now. If the stock moves >10% below initial purchase, buy second 1/3 position. There are other ways to ease in to a full position as well.

Early this year MCD, CVX, KO amongst other aristocrats were totally trashed in the media and forums. Guess what? Some of us made money on the trash talk. :-)

My last purchase of a partial position in WMT was 10/14/14 @$61.37/share.

Good luck in your investing.

M$$I