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'Boring' Wal-Mart Could Soar 41% Over the Next Year

By Brett Eversole
Tuesday, September 5, 2017

It's a crazy claim...
 
Could Wal-Mart (WMT) – a boring retailer – really soar 41% over the next year?
 
History says, "Yes!"
 
You see, the world's largest retailer has been on a hot streak...
 
Wal-Mart recently moved higher for 11 consecutive days. That's a rare feat. And history says it tends to lead to massive returns.
 
Since 1973, Wal-Mart has increased an incredible 41% a year after similar instances. And it could happen again, starting now.
 
Let me explain...
 
From its birth in the early 1960s, Wal-Mart has expanded from one small store in Arkansas to more than 5,000 stores all over the United States.
 
By 1991, the company made more profits than retail kings like K-mart and Sears.
 
Today, Wal-Mart has become the undisputed ruler of retail by sales. It's even closing the gap on e-commerce giant Amazon (AMZN) in online sales... Wal-Mart recently reported that it grew online sales 67% by volume in the second quarter.
 
This strong growth in online sales likely helped the company's share price move higher 11 days in a row. The chart below shows the recent uptrend. Take a look...
 

The uptrend is fully in place. Wal-Mart is up around 13% this year, thanks in part to this rare string of "up" days.
 
This has only happened 13 times in the past 44 years. And similar instances say the gains will continue...
 
Since 1973, when Wal-Mart's stock moved higher for 11 straight days, it has typically gone on to rally an average of 41% over the next year. Take a look...
 
 
3-Month
6-Month
1-Year
After extreme
11%
37%
41%
All periods
4%
8.2%
17.2%

These are fantastic return figures.
 
Obviously, Wal-Mart has been a winner since 1973 – returning 17.2% a year. But the stock crushed normal returns after instances like the one we saw recently.
 
Similar strings of "up" days led to 11% gains in three months... 37% gains in six months... and massive 41% gains over the next year.
 
I know it's a bold claim. It sounds crazy to say it...
 
But history says Wal-Mart has a legitimate shot at huge gains over the next year. And 41% gains are in no way out of the question.
 
If you've been thinking about buying this blue-chip stock, now could be the perfect time.
 
Good investing,
 
Brett Eversole




Further Reading:

A key financial gauge recently gave a good sign for stocks in the next month – despite what some fearful investors believe. Ben Morris has tested this idea going back to 1991. "One-month returns tended to be better than 'normal,'" he writes. Check out his findings right here.
 
A certain kind of tech business is soaring today – and it's a category that includes some of the world's biggest companies. Learn how this trend, and the global boom in stocks, have worked together to push Steve's China portfolio to new heights this year. Read more here.

Market Notes


NEW HIGHS OF NOTE LAST WEEK
 
Berkshire Hathaway (BRK-B)... Warren Buffett's holding company
Aflac (AFL)... insurance
UnitedHealth (UNH)... insurance
Biogen (BIIB)... biotech
Shopify (SHOP)... e-commerce powerhouse
PayPal (PYPL)... online payments
Match (MTCH)... online dating
Boingo Wireless (WIFI)... world's leading Wi-Fi provider
American Tower (AMT)... wireless "picks and shovels"
VMware (VMW)... cloud software
Red Hat (RHT)... open-source software
Apple (AAPL)... iPhone, iPad, Apple Watch
Microsoft (MSFT)... Windows, Office, Xbox
Activision Blizzard (ATVI)... video games
Electronic Arts (EA)... video games
Callaway Golf (ELY)... golf equipment
Constellation Brands (STZ)... Robert Mondavi, Corona
Monster Beverage (MNST)... energy drinks
Waste Management (WM)... trash and recycling
Lumber Liquidators (LL)... hardwood and laminate flooring
Owens Corning (OC)... roofing and insulation
Caterpillar (CAT)... heavy equipment
U.S. Concrete (USCR)... concrete
Rio Tinto (RIO)... diversified mining
Royal Gold (RGLD)... precious metals royalties
Alcoa (AA)... aluminum
Century Aluminum (CENX)... aluminum
Raytheon (RTN)... "offense" contractor
 
NEW LOWS OF NOTE LAST WEEK
 
American Outdoor Brands (AOBC)... guns
Sturm, Ruger (RGR)... guns
Hess (HES)... oil and gas
Chesapeake Energy (CHK)... natural gas
Shake Shack (SHAK)... fast food
Finish Line (FINL)... athletic shoes

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