Winners and Losers: Walmart Goes Progressive, Burger King Adds a Silly Sandwich
Companies can make brilliant moves, but there are also times when things don't work out quite as planned. From a Japanese gaming pioneer finally cutting prices on its poor selling devices to a burger chain introducing a burger for a buck, here's a rundown of the week's smartest moves and biggest blunders in the business world.
Walmart (WMT) -- Winner
The country's biggest retailer was singled out in this column last week for the way that it's bringing back its layaway plan for the holiday shopping season. And this week it earns another shout out.
In a memo to its associates this week, Walmart revealed that its health insurance policies for 2014 will cover "any spouse or domestic partner" regardless of gender.
Walmart knows that this is still a polarizing topic. However, by opening up health coverage to domestic partners -- gay or straight -- Walmart is likely to score points with many who have been critical of the company's practices in the past.
Sure, we can lament that just half of Walmart's 1.3 million associates have elected health coverage through the company. No one's saying the giant discounter is perfect. However, this move will help improve its image with a lot of its detractors.
Burger King (BKW) -- Loser
Burger chains are bucking the trend these days, beefing up their dollar menus at a time when the economy is showing signs of life.
There's a reason for that. Customers are moving up to higher quality "fast casual" establishments that offer better food at slightly higher price points with the convenience of counter service.
Burger King's latest push was announced this week. It will add a French fry-topped hamburger -- for a buck -- to its menu in September.
There's nothing inherently wrong with the new sandwich. Who hasn't placed fries inside their burger from time to time? However, this seems like a bad play for franchisees: They may see fry sales slip at the hands of penny-pinching diners believing that they can knock off a sandwich and a side for just a dollar.
Nintendo (NTDOY) -- Winner
What do you do when your video game console isn't selling and rivals are ready to hit the market with better systems in November? If you're Nintendo, you give the Wii U one final shot by lowering prices and bundling it with a popular release.
The Japanese gaming pioneer is slashing the price of its Wii U deluxe console by $50 to $299. That will make it $100 cheaper than the PS4 and $200 cheaper than the Xbox One when they hit stores in less than three months. It will also create a special bundle with a new game from its iconic Zelda franchise.
Nintendo isn't stopping there. It's also rolling out a cheaper alternative to its 3DS portable system. The new 2DS will feature a different layout and a price tag of just $129. Nintendo just may have saved its holiday shopping season.
LDK Solar (LDK) -- Loser
Solar energy has been a tough sector to invest in since the frenzied hype began to fade a couple of years ago. Drawing energy from the sun may seem great in theory, but the products that make it possible aren't cheap. LDK Solar and its peers rely on governments providing subsidies for new installations, but that hasn't been enough these days.
LDK had a particularly bad week. It kicked things off by posting another quarterly deficit with revenue falling by roughly half. Then it announced that it would be missing a debt payment.
The market doesn't like deadbeats.
Zale (ZLC) -- Winner
Upscale jeweler Zale saw its shares shoot higher after posting better than expected results. Revenue moved higher, fueled by a 5.6 percent increase in comparable store sales. Yes, it posted a quarterly loss, but even that was better than Wall Street was expecting.
Zale's strong performance came during the same week that rival Tiffany (TIF) posted uninspiring quarterly results and was downgraded by Citigroup. Tiffany has historically been the one to get the last laugh on Zale, but not this time.
Motley Fool contributor Rick Munarriz has no position in any stocks mentioned. The Motley Fool recommends Burger King Worldwide. Try any of our newsletter services free for 30 days.