Behavioral Finance Case
Not what you're looking for?
For many years, the large retail firm Wal-Mart chose not to provide guidance. The firmâ??s legendary founder, Sam Walton, wrote in his autobiography that he did not care what the market thought. Beginning in 1994, Wal-Martâ??s earnings announcements generated a string of negative surprises. In the resulting post-earnings-announcement drift, Wal-Martâ??s cumulative abnormal return relative to the S&P 500, drifted down for the subsequent four years. Wal-Martâ??s situation changed dramatically in 1998. An article appearing in Fortune magazine described Wal-Mart stock as being hot again, and noted that the reason stemmed from earnings. The article described Wal-Mart as having applied its â??Main Street marketing skillsâ? to its interactions with Wall Street analysts. Discuss what it means to apply â??Main Street marketing skills.â?
Purchase this Solution
Solution Summary
Behavioral Finance Case is discussed very comprehensively in this explanation..
Solution Preview
For many years, the large retail firm Wal-Mart chose not to provide guidance. The firmâ??s legendary founder, Sam Walton, wrote in his autobiography that he did not care what the market thought. Beginning in 1994, Wal-Martâ??s earnings announcements generated a string of negative surprises. In the resulting post-earnings-announcement drift, Wal-Martâ??s cumulative abnormal return relative to the S&P 500, drifted down for the subsequent four years. Wal-Martâ??s situation changed dramatically in 1998. An article appearing in Fortune magazine described Wal-Mart stock as being hot again, and noted that the reason stemmed from earnings. The article described Wal-Mart as having applied its â??Main Street marketing skillsâ? to its interactions with Wall Street analysts. Discuss what it means to apply â??Main Street marketing skills.â?
The Main Street Marketing skill of Wal-Mart in this context simply means communication skills of Wal-Mart personnel. In particular the financial staff of Wal-Mart has been more accessible ...
Education
- BSc , University of Calcutta
- MBA, Eastern Institute for Integrated Learning in Management
Recent Feedback
- "I read your comments, and thank you for this feedback. Do I need to find other studies that applied this methodology Ive used? That's where I'm stuck at."
- "Thank you kindly sir. "
- "Excellent and well explained. --Thank you kindly. "
- "Awesome notes. I appreciate you."
- "I have the follow-up project and I will assign that to you very soon. "
Purchase this Solution
Free BrainMass Quizzes
Pricing Strategies
Discussion about various pricing techniques of profit-seeking firms.
Basics of Economics
Quiz will help you to review some basics of microeconomics and macroeconomics which are often not understood.
Elementary Microeconomics
This quiz reviews the basic concept of supply and demand analysis.
Economics, Basic Concepts, Demand-Supply-Equilibrium
The quiz tests the basic concepts of demand, supply, and equilibrium in a free market.
Economic Issues and Concepts
This quiz provides a review of the basic microeconomic concepts. Students can test their understanding of major economic issues.