Warren Buffett And Rochdale See Value In Wal-Mart

Rochdale Research maintains its “buy” rating on Wal-Mart Stores Inc (NYSE: WMT). The target price for WMT is set for $65.

Warren Buffett has doubled its holding in WMT from 19.1 million to 37.8 million. According to Rochdale Research, WMT has a competitive edge in purchasing advantages and efficient distribution. Rochdale Research believes that Wal-Mart will shift its strategy from maintaining pricing edge over its competitors to maximizing its pricing advantage going forward, given the call of the company’s CEO to leverage SG&A in FY11.

Rochdale Research believes that Wal-Mart Stores has defensible characteristics such as being a low cost leader, generating highly attractive ROIC and having low capital requirements, strong balance sheet and extensive cash flows. WMT has transformed itself into a responsible corporate citizen over the past three years, Rochdale Research said.