The following video is part of our "Motley Fool Conversations" series, in which analyst John Reeves and advisor David Meier discuss topics across the investing world.
Over the next couple of weeks, John and David will be revisiting some calls they made on individual stocks of the Dow. Today, they're checking out Wal-Mart.
This company is up an impressive 21% in 2012 compared with a roughly 4% gain for the Dow average as a whole. John and David thought Wal-Mart would trail the Dow over the next five years. So far, that's been wrong. Really wrong.
The stock has been on a tear of late, up nearly 16% over the last three months, outperforming competitors such as Target, Dollar Tree, and Dollar General.
The low-priced retailer has had some good near-term performance, reversing a string of negative domestic same-store sales.
David is sticking with his underperform call, thinking the stock will not beat the market over the next five years. He does not believe the company has much more growth ahead of it and prefers a retailer like Costco instead.
Wal-Mart pays a pretty solid yield of more than 2%...
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