FTC Moves, and Walmart is Printing Money for Investors

      Today, we’re going to be talking about two items. The first item on the agenda is the election. A few weeks ago, Joe Biden was running against Donald Trump, and it looked like Trump was going to destroy Biden, but fortunately, Biden dropped out. Now, Trump is running against a much more competitive opponent. We’re going to discuss the economic implications of a Kamala win. Next, we will chat about Walmart, a company that I have unduly ignored for years.

      I was a bit pessimistic last I wrote about the prospect of Donald Trump winning, mostly because I hate what his election would mean about this country, but from a purely my portfolio point of view, his election would be great. Under Biden, and presumably under Kamala if she is elected, the FTC has been a weapon, which I love as a citizen. Microsoft, Apple, Amazon, Meta, and Google have all been in Lisa Khan’s crosshairs, but these companies were practically given free rein under Trump.

     If you are completely uncertain about buying a mega-cap stock, don’t. First, you should never buy a stock if you are uncertain. You are either fully in, or you are fully out, but more is lost by indecision, being half-in and half-out. Second, don’t buy a mega-cap because it is going to be much harder for mega-cap companies to buy out competitors, add to their portfolios, and exercise the benefits that come with practically being monopolies. I can tell you as someone already slightly hesitant about Apple’s ceiling for growth, a Kamala Harris presidency alleviates no concerns.

     On a more personal note, (sorrrryyyyy for being political ) a more aggressive FTC is great. These companies are not innovating as much as they could be, and it means that we are losing the opportunity cost game as a country. I love an aggressive FTC. A passive FTC that doesn’t even threaten to take these companies to court is just a waste of taxpayer money.

     Now, on to Walmart. Walmart is crushing it so far this year, up over 38%, after some mediocre years. Sales are growing at a 4.2% clip compared with 12 months ago, which is unbelievably for a company of Walmart’s size, America’s largest company by revenue for the past ten years. Sales growth of 4.2% is especially great because the rest of Walmart’s competition averaged 2.8% growth. Walmart raised its full-year guidance, net sales will grow 5% for the rest of the year, Walmart’s consumer is staying extremely strong, e-commerce sales increased 21% this quarter, their higher-income focus is yielding results, and every other key metric increased as well.

     Walmart has been a company I have overlooked for a while. Costco has been the only stock in the consumer staple sector I have ever looked at, but Walmart may be worth a chance. Because of my tech focus, Walmart was a company not on my radar at all, which is a naïve mistake, but the more I think about Walmart, the more I like it.

       Walmart’s strength boils down to its strong consumers. I live in prime Walmart territory: The rural South. Walmart virtually owns my town, and during my entire time living here, I have never not seen that parking lot jammed full. Economic downturns, stimulus checks, Black Friday, it does not matter, people are going to Walmart. It is because of this strength, that I like their focus on improving the bottom line. The top line is already massive, and it would take a major risk to grow that number dramatically, but adding in new sections to woo consumers with a higher income is an example of a great, bottom-line-focused move.

      I am going to keep my eye on Walmart, but I will NEVER abandon Costco #Costcostrong.