Johannesburg - Walmart is the new gold as investors flock to buy its shares in the retail giant seen as a safe haven amid slowing global growth and volatile markets, say analysts.
Walmart's same-stores sales in the US have improved for nine consecutive quarters pushing up its shares 24% this year, and briefly making it the world's third most valuable firm, said
Business Report.
Investors in the US are eager to find out how much higher their shares can go.
“In some sense, it is like gold,” David Abella, a portfolio manager at Rochdale Investment Management is quoted as saying.
“It’s a safe bet in an economy like this. If you start to see other retailers do well or consumers appear more confident, then it is time to take gains and get out.”
The slow economic recovery in the US had made investors nervous, helping to push up Walmart shares, said Abella.
With a market capitalisation of $251.3bn (R2 trillion), Walmart is at its most valuable since March 2004.
The Competition Commission approved a merger by South African retailer Massmart Holdings
[JSE:MSM] and Walmart in May last year, giving the American firm 51% stake in Massmart, the parent company of Game, Dion Wired, Makro and Builders Warehouse.
Walmart operates in countries around the world including Canada, Brazil, China, Chile, Japan and Mexico.
- Fin24
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