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Wal-Mart Analyst Meeting Today: What Happened to Sales?

Wal-Mart Stores is holding an analyst day today. Investors will use the chance to get to know Bill Simon better — he has been running the USA division only since June.

Issues being mentioned by traders:

1) comp store sales: Wal-Mart rolled back prices to drive more customers into stores and steal share from supermarkets, and arch-rival Target . It didn't work. Q2 U.S. comp store sales declined 1.8 percent, TGT was UP 2.80 percent in q1 and UP 1.70 percent in Q2.

What happened? Dollar stores continue to be the share gainers in the low end space, traders tell me. Supermarkets and WMT continue to fight it out on price and the supermarkets appear to be winning some of the battles for traffic.

2) commodity inflation and how WMT will absorb higher prices. Cotton, soybeans, corn, wheat...all going up.

3) getting smaller store into bigger urban markets. WMT has not been very successful in urban markets, but they need to get in there to compete with the Family Dollar and Dollar General types.

Look at the market share if you don't believe me:

Rural: 12+%

Urban: 4%

(Source: ISI)

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  • A CNBC reporter since 1990, Bob Pisani covers Wall Street from the floor of the New York Stock Exchange.

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