[squiffy]

I am still trying to figure WMT out.
Clearly a great long term buy. BUt is this the right entry point? Not clear. What if a recession hits.

Note price has been dropping for 1 year and 6 months from high of about 62 in Feb. or March 2004. General trend is a downslope. Very strange.

Note the last official recession we had was from 3/2001 to 11/2001. Note graph during that time shows some peaks and valleys, but basically a stable, then declining price.

So even WMT hurt by recession.

Note recessions are declared late. I guess many months or even years after the fact. So not clear if we have had any recessions since then.

And even if we have no recession, I suppose we can have a down stock market, or a particular stock price can go down.

The reason I emphasize the question of why WMT has gone up and down in the past 5 years, is that to be a great stock picker, it helps to understand how the company is performing and why it is performing well or badly. Is it management, growth, the U.S. economy, the world economy etc.

If the problems are temporary, then it is a great buy and a GREAT TIME to buy. If the problems are long-term and hard to solve it may not be a good time to buy.

Sometimes a stock price will hit a 10 year low. If you buy after it hits a one-year low, this can suck.

Imagine buying KO at 60 in Jan. 2001 and watching it drop to 44 over the 4 years and 10 months to Oct. 2005. Great investment right? Great company long term, right? But short of medium term, you kissed your money good-bye. Not much fun.

If WMT is at the start of a 5 year decline in price, do you want to buy now after a 1.5 year decline in price?

You can invest at any time or for any reason you want. After 5 minutes, 5 hours or 5 days of research. But in my mind, unless you can understand the company, and it's past ups and downs, its hard to realiably predict its future ups and downs.

Note one thing from the last annual report. That some heavy selling may have been done my index funds in something like 3/05 and 9/05 due to re-weighting by the S&P 500 Index. SO that may have had some downward effect on the stock. Though how much I am not sure.

On the other hand WMT has been buying back stock, which should have helped prop up the price.

So if WMT has had such great numbers recently it makes no sense to me that it's price has been dropping while it's profits have been solid.

S&P 500 has been even or slightly down this year. Dow is slightly down. AVP, BUD, and WMT all down. I am wondering if we are in a recession now? Or whether it is a temporary down market.

I wonder if all the money pouring into real estate, which is artificially INFLATED, is part of the reason that WMT, AVP, and BUD are artificially LOWER.

I guess so far, I am very interested in WMT. I thought it was too high before and did not pay any attention to it. I am glad you mentioned it. So far it does look inviting.

It also looks pretty volatile, it seems to go down a lot in recessions and up a lot in recoveries, so a great stock if you can get the timing right.

I am just figuring out how much money to put into it and when to buy.

What worries me is that there is increasing inflation, increasing cost of the war in Iraq and Afghanistan 7 billion and 1 billion per month according to the papers, higher oil prices, etc.

So I need to understand why price has dropped so much from 60 to 44 over 1.5 years, when profits have been increasing by 10-15% per year for the past 3 years.

If it goes back from 40 to 60 again, that's an easy 50% gain in a year or so. If you have the courage to use options, you can do even better. Though I would have to really be sure of why it has gone down, before I used options.

If you cannot figure out why it has gone down, it's also hard to predict why it will go back up and when.