The Alpha Algorithm Targets a Global Retailer

Nicholas Vardy

Nicholas Vardy has a unique background that has proven his knack for making money in different markets around the world.

This week’s Alpha Algorithm recommendation, Wal-Mart Stores, Inc. (WMT), popped up in several new Alpha strategies this past week.

This is surprising given that Wal-Mart’s stock has underperformed the broader market, as measured by the S&P 500 since the beginning of the year. Clearly, the smart strategists on Wall Street expect Wal-Mart’s stock to bounce back strongly over the coming months.

Founded in 1945 and headquartered in Bentonville, Arkansas, Wal-Mart Stores, Inc. operates retail stores in three segments: Walmart U.S., Walmart International and Sam’s Club. As of June 20, 2016, it operated 11,527 stores under 63 banners in 28 countries and e-commerce websites in 11 countries.

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Wal-Mart Stores, Inc. (WMT) versus the S&P 500 year to date.

Eight Top Investment Strategies Betting on Wal-Mart Stores, Inc. (WMT)

1. Goldman Sachs’ Active Beta

The stock is selected according to four factors — value, quality, momentum and low volatility. These, in turn, are based on criteria including book value, sales and cash flow scaled by share price, profit/assets or return on equity (ROE), risk-adjusted returns and daily standard deviation of returns.

2. Fundamental Strength

A top U.S. stock based on fundamentals measured by book value, cash flow and sales dividends.

3. Dividend Aristocrat

The stock is among those in the S&P 500 that have increased dividends for at least consecutive 25 years.

4. Broker’s Best

One of Raymond James’ selection of stocks expected to outperform the S&P 500 over either a six- or 12-month period.

5. Capital Strength

The stock is part of a strategy that seeks to outperform the market by selecting companies based on the strength of their balance sheets, long-term debt ratios and return on assets (ROA).

Exclusive  Putting the Panic in Perspective

6. Small-Cap/Value Tilt

Selected using a multi-factor modeling approach, the stock is a smaller-cap or value stock designed to enhance portfolio risk/return characteristics

7. Large-Cap Momentum

The stock is part of a major hedge fund’s systematic strategy that invests in large- and mid-cap U.S. companies with positive momentum and that rank in the top third of total return over the prior 12 months, excluding the last month.

8. Value Line 100

One of the top 100 stocks in the universe of 1,700 stocks for which Value Line gives a #1 ranking in the Value Line Timeliness Ranking System, based on expected price performance over the following six to 12 months.


Buy Wal-Mart Stores, Inc. (WMT) at market today.

Place your initial stop at $64.50


I am holding off on recommending options on this position this week.

Portfolio Update

Your position in Apple Inc. (AAPL) is now up over 21.22% and your position in Home Depot (HD) has gained over 17.61%. You have a minimum of 15% gains locked in on both positions, based on the current stock price of each.

You stopped out of Altria Group Inc. (MO) at $73.92 on March 23 for an 18.01% gain.

VAA 3-30


Nicholas Vardy

Nicholas A. Vardy

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