Wal-Mart Stores Inc. also known as Wal-Mart is a multinational retailer corporation based in America. The corporation runs massive stores discount departments and warehouse stores chain. The corporation is listed to be the third largest public corporation in the world by Fortune magazine. With over two million employees around the world it makes the corporation to be the biggest private employer. Sam Walton was the founder of Wal-Mart in 1962 and the corporation has remain a family tradition business which the Walton family own 48% stake in Wal-Mart and they have traded publicly on the New York stock exchange. Due to corporation to be the biggest grocery retailer in America with $258 billion dollar sales in 2009, it is one of the world most valuable companies.
Wal-Mart operates with 55 different names in 15 different countries and they are Wal-Mart in America and 50 others in Puerto Rico, Walmex in Mexico, Asda in United Kingdom, Seiyu in Japan and Best Price in India. They have got wholly own operations in Brazil, Argentina, and Canada and have joint ventures in Germany and South Korea. Unfortunately the joint ventures were unsuccessful.
Introduction
This analysis will examine how changes in foreign exchange rates affect the settlement of its contracts, cash flows and market value of Walmart in details.
The ability of exposure to the foreign exchange can measure the profits of a company, cash flow, and the value of the market. In every company, there is a finance manager that is in charge of the company’s finance to expand their profits to the maximum. So in this case when the company traded publicly in the foreign exchange, the finance manager has to measure the effects of the company exposure to the foreign exchange, so they could expand the profits to the maximum, the value of the market and cash flow of the company.
There are 3 types of exposure to the foreign exchange and that are transaction, translation, and exposure of the