Wal-Mart Looks Abroad to Regain Momentum

Wal-Mart (NYSE:WMT) has grown well beyond its Arkansas roots to become the largest public corporation in terms of revenue. We estimate that Wal-Mart International accounts for around 32% of the stock value, driven by aggressive growth plans in developing markets. Wal-Mart competes with other big retailers like Target (NYSE:TGT), Costco (NASDAQ:COST) and Best Buy (NYSE:BBY) in the US and a hosts of others in international markets.

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Why The Future Continues to Look Bright for Wal-Mart

Although we predict Wal-Mart’s revenue per square foot to remain about the same in the next few years, that certainly isn’t the case for the number of stores. Apart from continuing to grow the number of stores in the US, we also predict a substantial increase in the number of stores in international markets.

We expect the number of Wal-Mart International stores to grow from the current amount of 4,860 to 6,720 by the end of the Trefis forecast period, an increase that, when coupled with other drivers, is likely to cause the company’s stock price to significantly rise from the current market price, $59.70, to the Trefis estimate of $74.20.

The Past Dictates the Future

If the past is any indication of the future, Wal-Mart will surely continue to increase its global presence. In 2004, Wal-Mart had 2,734 International stores; this number increased to a whopping 4,560 in 2010. Trefis expects this number to continue to rise as Wal-Mart aggressively expands in areas where it has a limited presence, in particular developing markets, such as Mexico, China and Brazil.

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