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Wal-Mart Stores: Hyphenate Less

To hyphenate or not to hyphenate, that is the question on the minds of many business editors.

CNBC.com

More than a year after changing its logo to the unhyphenated "Walmart" followed by a star burst, the world's largest retailer issued an editor's note today regarding the proper usage of its name.

The guidance, which was buried at the end of its second-quarter earnings release, said use either "Wal-Mart Stores Inc.," the legal name of the company, or "Walmart," the trademark of the company, but never Wal-Mart. Got it?

The company's decision obviously is aimed at advancing their branding strategy, but it doesn't necessarily sit well with editor-types, who have probably spent a ridiculous amount of time debating the pros and cons of making the switch.

Editors rather stick to their own style rules, and here at CNBC.com, we plan to use "Wal-Mart Stores", the legal name of the company, and shortened "Wal-Mart", when referring to the company. However, when referring to the store or the brand, it's fine to use "Walmart."

It's interesting that Wal-Mart has chosen this moment to take a stand, when reporters who write about their company are perhaps better served by looking closely at the quarter's earnings results. (A Wal-Mart spokesperson has not yet returned a call seeking further comment on the timing of its editorial note.)

The hyphen debate has been floating around for about a year now, even since the company switched to the new logo, which was its sixth over its 47-year history.

The latest earnings report had plenty of important elements to contemplate. The earnings came in above analysts' expectations, but sales fell short.

"We view it as a very encouraging report," said John Lawrence, managing director of Equity Research at Morgan Keegan, noting how Wal-Mart's ability to manage its costs and its inventory helped it to keep profits on the high-end of its earnings forecast and above analysts' estimates. (To hear more about Wal-Mart's results from Lawrence, click here.)

"You've had nine consecutive quarters now of inventory improvement for this big company, and that's pretty impressive," Lawrence said.

But that is balanced by tough commentary about the consumer from Wal-Mart Chief Financial Officer Tom Schoewe, who said that customers shopping at Walmart remain under pressure.

According to Schowe, some customers are running out of money at the end of the month. They are using more cash than credit. And, when they shop, they are still sticking to the basics, and buying those items closer to the moment when they need them. Those trends are being illustrated by back-to-school purchases, which are being delayed until closer to the school year.

What's been helping Wal-Mart is that customers are trading down. As the recession has worn on, Wal-Mart has attracted new customers, but there are questions about whether they will keep them, and those questions are more important to investors than whether one should put a hyphen in the company's name.

(UPDATE: Wal-Mart spokesman John Simley called later Thursday and said the shift to one name, without punctuation is part of the next wave of its branding strategy, which it began last year. In recent weeks, the company has been adding the editor's note to its press releases.)

Although the company has no plans at this time to change its legal name, the company anticipates that news organizations will eventually follow the company's branding guidelines, "it's just a matter of when," Simley said.)

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