Retail giant Wal-Mart Stores, Inc. (WMT) has been seeking new ways to boost revenue amid macro-economic headwinds like budget-strained customers, reductions in government benefits, higher taxes, tighter credit and higher group health care costs.
Recently, Walmart surveyed hundreds of kids aged 18 months to 12 years and revealed its top 20 toys list. The findings revealed that kids are looking for imaginary and creative toys. Walmart is thus closely working with its suppliers to stack up its stores and e-commerce distribution centers with creative and evergreen classic toys for the upcoming holiday season.
Through the holiday season, all of the top 20 toys will be covered under Walmart’s Savings Catcher online receipt comparison tool, which means that if any local competitor offers a lower advertised price on those or other eligible items, customers will get the difference on a Walmart eGift Card.
Retailers seem to be busy focusing on introducing new brands in order to keep the inventory assortment fresh and drive customer traffic to their stores. Recently, another retailer Kohl’s Corp. (KSS) has also announced that it has packed its stores with top new and classic toys from national brands like Barbie, Teenage Mutant Ninja Turtles, Fisher-Price, Melissa & Doug, Nerf, Play-Doh, Playskool and more to attract customers during the holiday season. (Read: Kohl's Gears Up for Holiday Season; Launches Toy Brands.)
Walmart has been struggling of late. It performed disappointingly for five straight quarters before turning around in the recently reported second quarter of fiscal 2015. The retail giant posted in-line earnings and better-than-expected revenues. However, Walmart lowered its fiscal 2015 earnings guidance to a range of $4.90 to $5.15 per share, from the previous range of $5.10 to $5.45, due to incremental investments in e-commerce and higher U.S. health care costs than previously anticipated. (Read: Walmart Falls After Cut in Fiscal View, Q2 Earnings In Line.)
In such a scenario, the initiative to stock items as per consumer preference is surely an encouraging step to drive traffic amid a sluggish revenue environment. Walmart currently holds a Zacks Rank #3 (Hold).
Other Stocks to Consider
Some better-ranked retailers worth considering include Citi Trends Inc. (CTRN) and Foot Locker Inc. (FL). While Citi Trends sports a Zacks Rank #1 (Strong Buy), Foot Locker holds a Zacks Rank #2 (Buy).
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