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Should You Become a Wal-Mart Shopper?

Wal-Mart is known for offering shoppers very attractive prices. But can the same be said of its stock?

Stifel Nicolaus sure thinks so.

The firm upgraded Wal-Mart to "buy," with an $83 price target saying the retailer is likely to remain resilient during a possible slowdown like it did in 2008.

(As consumers faced high gas prices, food inflation and a shaky housing market in 2008, Wal-Mart gained 20% as cash strapped Americans pinched pennies.)

Other advocates of the stock point out that Wal-Mart is experiencing an increase in once a week shoppers; they say it’s a sign that more Americans are turning to Wal-Mart as a grocery store – drawn to their less expensive food items.

Although canned vegetables, paper towels and peanut butter pretzels may be cheaper at Wal-Mart, top trader Stephanie Link, director of research at TheStreet, argues that the same can not be said of its stock.

“It’s trading around 14 times earnings and historically the average is 13 times.” If anything she says the stock is expensive.

She concedes that the stock has been a strong defensive trade but after the move she thinks there are better places to play.

“For example, Target is a better bet,” she says. “And I’m watching Costco. I’m a buyer of Costco if it pulls back.”

As a consumer you'll get good prices at Wal-mart but as an investor, “There are much better values,” she concludes.

Posted by CNBC's Lee Brodie

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Trader disclosure: On August 6, 2012, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders; Joe Terranova is long SEPT. MINI S&P FUTURES; Joe Terranova is long VRTS; Joe Terranova is long MCD; Joe Terranova is long USB; Joe Terranova is long GS; Joe Terranova is long JPM; Joe Terranova is long YHOO; Joe Terranova is long SBUX; Joe Terranova is long WFM; Joe Terranova is long AAPL; Joe Terranova is long EMC; Joe Terranova is long NXPIZ; Stephanie Link is long AAPL; Stephanie Link is long MCD; Stephanie Link is long DIS; Stephanie Link is long SLB; Stephanie Link is long LRCX; Steve Grasso is long ASTM; Steve Grasso is long BA; Steve Grasso is long D; Steve Grasso is long FRO; Steve Grasso is long LNG; Steve Grasso is long MHY; Steve Grasso is long MO; Steve Grasso is long NVIV; Steve Grasso is long PFE; Steve Grasso is long S; Steve Grasso is long XLU; Jon Najarian is long call spreads in GMCR; Jon Najarian is long call spreads in OCN; Jon Najarian is long call spreads in SBUX; Jon Najarian is long call spreads in YELP; Jon Najarian is long call spreads in MON; Jon Najarian is long put spreads in HPQ; Jon Najarian is long put spreads in KCG; Jon Najarian is long CME; Jon Najarian is long CBOE; Jon Najarian is long CIGX; Jon Najarian is long GLUU

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