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"20 Signs Walmart Is Falling Apart Before Our Eyes"
by Epic Economist
"As the U.S. moves towards another recession, Walmart's empire is silently crumbling down. When you're the world's biggest retailer, even a one percent drop in earnings can be translated into billions of dollars in losses. But profits are down by almost a quarter compared to a year ago, which means that the big-box retailer's woes are far worse than anyone would've imagined. For decades, Walmart was the company competitors feared most, but new numbers show that the retailer has been falling behind in recent years. Walmart has begun to lose popularity amongst consumers, and major holes are starting to form in its business. For the most part, the company has hidden its financial struggles from the headlines because the problems it face are different across the world, which allows the superstore chain to mask itself in the overall picture.
The news gets worse. "Profits," it turns out, are the least of Walmart's problems. The retailer didn't generate any cash from operations at all this past quarter, instead consuming $3.8 billion. Add in $3.5 billion in capital spending, and Walmart's free cash flow for Q3 was a dishearteningly negative $7.3 billion. And the company hadn't experienced negative cash from operations since Q3 1995, more than a quarter-century ago, according to historical data provided by S&P Global Market Intelligence.
And more financial losses may be coming for Walmart: The IBD Stock Checkup shows that earnings have actually fallen by an average of 4.5% over the past three quarters. This is well short of the 25% growth sought by investors. Over the past three years, the retail chain’s monthly sales have grown by an average of 10%. That’s why its projected 4% sales growth for the final quarter of 2022 seems so unimpressive. In other words, investors are seeing Walmart stock as a no-buy right now.
Walmart traditional business model is showing persistent signs of weakness both in the U.S. and overseas. If the retail giant fails to adapt to new market trends, e-commerce competitors may crush the Walmart and push it to a downward spiral we've seen so many other retailers go down in recent years. Will the biggest retailer in the scene be a victim of the relentless retail apocalypse? That is yet to be seen. But the outlook isn't promising right now, and the last earnings report was a train-wreck that resulted in major losses right after the retail chain experiencied a pretty bad losing-streak. At the end of the day, company's demise is a mere reflection of a collapsing economy, and what we've seen so far is just the beggining of a series of defeats that lie ahead for Walmart, American consumers and our entire economy.
As Motley Fool's Travis Hoium noted, when we dig between the lines, we can rapidly see a company in serious trouble and could be the "latest in a long line of leading retailers to go from boom to bust in the blink of an eye". That's why in today's video, we compiled a series of numbers, facts and stats that prove that Walmart's best days are behind it."
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