Wal-Mart (NYSE:WMT) Stock Surges After Years of Decline

After witnessing a consistent slump for the past two years, Wal-Mart (NYSE:WMT) is finally regaining its market strength. The past quarter brought ascension of almost 12 percent in the past month. Investors are curious whether Wal-Mart (NYSE:WMT) has found stability, managed to turn its tables or was this 12 percent surge just a fluke? Here’s what analysts have to think about it. Wal-Mart (NYSE:WMT) has been experiencing cut throat competition in the past two years because of the tremendous rise of dollar general and family dollar chains.

These chains became the new convenient destination for customers to get good bargains. Convenience stores also found itself small market to keep the cash flowing. Wal-Mart (NYSE:WMT), on the other hand, found itself being isolated and running almost on its past reputation. Wal-Mart (NYSE:WMT) was lacking innovation; hence it turned to small format stores which didn’t beget the company any substantial sales. On top of that, the waning economy also took a toll on the self proclaimed ‘King of Retail’.

Although these small format stores didn’t boost the sales instantly, they certainly helped the company recover from the slump. These stores housed the most popular items that were usually required by the customers and hence became supercenters for customers to go to and grab what they’re looking for. Another thing that helped Wal-Mart (NYSE:WMT) was the online channel. Wal-Mart (NYSE:WMT) has always vouched for technology as a platform to expand business.

Wal-Mart (NYSE:WMT) roped in numerous small tech firms to attract and engage customers at a high level. Wal-Mart (NYSE:WMT) still invests a lot in its technological infrastructure. Wal-Mart (NYSE:WMT) spent 800 million dollars on its e-commerce this year with the announcement that the company would be spending 1 billion in the next fiscal year. This clearly shows the company’s dedication towards to e-commerce, which indeed, is the future of the retail business.

Wal-Mart (NYSE:WMT) has enhanced the shopping experience by introducing its own online grocery channel which is all about the essence of convenience for the customers. It is highly appreciated in the market and has been catalyzed the push Wal-Mart (NYSE:WMT) so desperately needed since the past couple of years. Investors are keenly observing Wal-Mart (NYSE:WMT)’s stock. Though it still isn’t as formidable as investors would have wanted but the boost has made it clear that Wal-Mart (NYSE:WMT) still has the power to convert a failure into a success.

But investors would like to wait it out and see how the stock performs in the next year, or at least in the initial months; because Investors wouldn’t want to board a ship that isn’t consistent in its sail. Wal-Mart (NYSE:WMT) has been in the retail business for a long time and it is too soon to pass any judgment on its business policies but it’s one of those companies that is fond of technology which can tell you that Wal-Mart (NYSE:WMT) is aware of the era change and is keen to change with it.