There are no safe havens in the stock market. Every stock carries risk. But some less than others. This column features stocks that have shown one or more of the following characteristics: less volatility, better earnings, larger market caps, safe and increasing dividends. In these times of turmoil, our goal is to show readers better opportunities for investing with fewer risks.

February 7, 2011 - Wal-Mart Stores, Inc. (WMT-NYSE) operates retail stores in various formats worldwide. The company's Walmart U.S. segment offers meat, produce, deli, bakery, dairy, frozen foods, floral, and dry grocery; health and beauty aids, household chemicals, paper goods, and pet supplies; electronics, toys, cameras and supplies, photo processing services, cellular phones, cellular service plan contracts, and prepaid service; fabrics and crafts, stationery and books, automotive accessories, hardware and paint, horticulture and accessories, sporting goods, outdoor entertaining, and seasonal merchandise; apparel, shoes, and jewelry; pharmacy and optical services; and home furnishings, housewares, and small appliances through discount stores, supercenters, and neighborhood markets, as well as through walmart.com.

As of January 31, 2010, it operated 803 discount stores, 2,747 supercenters, 158 neighborhood markets, and 596 Sam's Clubs in the United States; 43 units in Argentina, 434 in Brazil, 317 in Canada, 252 in Chile, 170 in Costa Rica, 77 in El Salvador, 164 in Guatemala, 53 in Honduras, 1 in India, 371 in Japan, 1,469 in Mexico, 55 in Nicaragua, 56 in Puerto Rico, and 371 in the United Kingdom, as well as 279 stores in the Peoples Republic of China. The company was founded in 1945 and is based in Bentonville, Arkansas.

Looking at a price chart for WMT doesn't get investors excited. It's almost flat from 2000 until now, trading in a rather tight range, compared to the rest of the market's gyrations in that decade. And that's what should make it appeal to Conservative investors. While there hasn't been anything to break the stock out of its upper levels, nothing has made it drop, like almost every other stock did in 2008 until early 2009.

For some of the country, the recession is over. Not for most of Wal-Mart's customers. Most of them make less than $70,000 a year. One-third of sales go to customers making $25,000 to $49,000. And they've been spending less, as well as visiting less. Part of it is the economy. Part of it was the new selling strategy at WMT. Management moved away from everyday low pricing and a reduction in the number of brands offered, paticularly in foods. So shoppers shopped elsewhere, like dollar stores and other competitors. These customers have most likely been hit hardest by the recession and finding the best value for each dollar is their highest priority.

Management isn't sleeping. It's bringing back thousands of products. It's getting back to offering everyday value, selling goods at the lowest prices in most categories. Layouts of the stores are changing, putting back the "action alley" where promotional goods are, and the aisles wider. Expect sales to improve on these moves.

Look for earnings of 2010 to be $4.05, up from $3.66 last year. For the final quarter of 2010, expect $1.32, above the $1.17 of 2009's fourth period. In the first quarter of this year, look for 96 cents vs 87 cents last year. Fiscal year ends on January 31.

Essential numbers: Trailing P/E is 13.88 while Forward P/E is 12.60. Price to sales ratio is .48. Price to book is 3.06. Book value is $18.29. Operating margin for the last 12 months was 6.08%. Profit margin was 3.59%. Return on equity was 22.69% and Return on assets was 8.86%.
There's $10.62 billion in cash for $2.98 a share. Total debt is $56.82 billion. Debt to equity is 86.71%. Current ratio is .87. There are 3.45 billion shares outstanding. Float is 1.85 billion. Insiders own 45.98% of the stock. Institutions have 33.60% of the Float. The annual dividend is $1.21 for a yield of 2.1%.

Conservative investors can find a lot to like here: high return on equity, relatively low P/E, as well as strong insider ownership. The low Beta is also comforting. The news here is that management is getting back to selling as it used to be, the way it worked best in the past. It may take a little while for the word to spread, but expect old customers to come back once they realize Wal-Mart is serious again about offering the best value for their shopping dollar.