Walmart Research

             Wal-Mart 2003's liquidity is a concern to our analysis. Its quick and current ratios reflected high current liabilities. However, by looking at Wal-Mart's cash flows, which increased substantially during the same year from $10.3 billion to $12.5 billion (WMT-annual report), we feel that Wal-Mart will meet its current financial obligations without a problem. As reported, the company paid $1.3 billion of debt in the year of 2003. In addition, Wal-Mart's capital asset reinvestment and stock repurchase plan were high and they implied management's control to maintain sustainable growth in the short term. Regarding the soundness of the consolidated balance sheet, one thing would raise a concern is the $1000 million of debts which can collected at any time depending on the creditors' discretions. Without knowing for sure when these creditors may choose to collect the debts, the company needs to have a certain strategy to deal with such possibly material amount of cash.
             Non-current liabilities are favorable for Wal-Mart. Most recently, the SEC declared effective a shelf registration statement under which the Company may issue up to a total of $10 billion in debt securities, which would at least secure ability for the Company to raise additional debt in the near future if needed. Meanwhile, interest cost declined by .17% in 2003 both domestically and internationally due to lower interest rates, to the company's efforts to reduce average inventory balances and to the positive impacts of the hedging swap programs. Overall, the outlook for the company's long-term debt is positive.
             The Company utilizes both operating and capital leases in its operations. Operating lease's total minimum rentals after 2004 is estimated at $7988 and capital lease's minimum rentals is $5,282(Annual report). As noted by management, certain leases
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