Jim Cramer crushes Walmart management — ‘It’s embarrassing’
Jim Cramer ripped into Walmart’ s management Tuesday after the retail behemoth r eported quarterly profits that were worse than expected and reduced its full-year earnings guidance. “This was a terrible quarter,” he said on “Squawk Box.” “Inventories bad. Sales bad. Execution terrible. Really is a suboptimal situation. … The execution here is so poor, it’s embarrassing.” Cramer said while all U.S. retailers are having to navigate inflationary pressures, he believes others such as Club holding Costco were able to perform better than Walmart. “When you see disparities like this, that’s because one company is doing better than the other,” Cramer said, adding later: “This should be a big soul-searching moment for Walmart. They need that.” Shares of Walmart, a Club name, dropped more than 9% Tuesday following the results to trade below $134 apiece. The stock has the third-smallest weighing in Cramer’s Charitable Trust portfolio at 1.26% based on Monday’s closing price. Cramer noted that in March, the Club made several sales of Walmart shares at higher stock prices than Tuesday’s early morning action. The stock was trading just north of $144 per share in each of those March transactions. While the Club only owns 250 shares now, Cramer said that’s not the point. “Doesn’t matter if it was 25 shares. We made a mistake,” he said during Tuesday’s “Morning Meeting,” explaining his primary error was believing that Walmart represented a defensive stock for the current environment. He said part of the reason why Walmart’s stock was sliding so much Tuesday was because only a few months ago, management said it expected a mid single-digit increase in earnings per share this fiscal year. Now, the company projects a 1% decrease. “The sellers are motivated and, frankly, correct,” Cramer said. Read the CNBC Investing Club’s full in-depth analysis on Walmart’s disappointing quarter . (Jim Cramer’s Charitable Trust is long WMT and COST. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
