Tim Knight | Aug 19, 2015 02:03AM ET
On Tuesday morning, Wal-Mart Stores Inc (NYSE:WMT) reported a 15% drop in profits year-over-year and warned they would be dropping estimates for forthcoming periods. I’ve placed countless thousands of trades in my life, but I don’t think I’ve ever traded a single share of Wal-Mart. In spite of this, I decided to dust off the WMT chart and take a look at what was going on.
Take a look at this long-term chart of the company below (click for a larger image):
I’ve tinted the chart various colors to indicate these broad periods:
Thus, over the past half-year, sixty billion dollars in shareholder wealth have vanished, and it seems altogether likely that Wal-Mart has seen its peak stock price for a long, long time.
What’s striking to me about the recent activity is that this a singularly ugly period of WMT stock behavior. Over the years, there has been a lot of “backing and filling”, but what’s happened over the past six months is a different beast altogether: lots of “backing” and hardly any “filling”.
I think we’re witnessing a sea change in the behavior of Wal-Mart, and this is probably a helpful harbinger of the American economy as a whole.
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