Walmart: 'Going to a very dark place'
POSTED: Friday, August 1, 2014 - 6:30am
UPDATED: Monday, August 4, 2014 - 11:39am
Goldman-Sachs downgraded Walmart's stock to 'Neutral"
NEW YORK (CNNMoney) — Walmart may not go the way of RadioShack any time soon. But Goldman Sachs says that customers are abandoning the big-box pioneer in droves.
On Tuesday, the investment bank downgraded Walmart's stock to 'Neutral,' saying that big-box stores are losing out to online retailers and stores with more focused inventories.
With $115 billion in annual sales, Walmart isn't quite going out of business, but the retailer has seen sales slip for five straight quarters. Online shopping is clearly hurting the store, as more customers turn to Amazon and other merchants for everyday items such as hardware and groceries.
E-commerce is making Walmart's vast breadth of merchandise less appealing to shoppers. Instead, customers are looking for better deals on a more narrow assortment of goods available at stores like Costco and dollar stores The bank upgraded Costco's stock to Buy.
Goldman noted that Amazon's move into grocery sales is the biggest threat facing Walmart and a risk to Costco.
Despite the bank's pessimism about big-box retailers, maintained a 'Buy" rating on Target.