Tuesday, July 29, 2014

Wal Mart is a Welfare Client?

Great comment at the CoBF:

"I decided that Walmart is a bubble stock.

It's at 15x earnings and those earnings are inflated by government welfare programs.  Essentially, they pay less than a living wage, then the government buys food for their employees "the working poor", and the Walmart shareholders pocket the difference.

Not sure when that market distortion is going to end.  It would take a big political change to get the federal minimum wage raised up to the "living wage" level.  That would be the level at which Walmart would be feeding and clothing their own workers, rather than having the government essentially make payroll for them."
WMT has TTM net income of ~$16 billion and apparently 2.2 million employees - profit per employee of $7,270.

1 comment:

Anonymous said...

Wow, this is the dumbest comment I've read in quite a while.