Bloomberg News

Walmex Advances After Credit Suisse Upgrade: Mexico City Mover

February 17, 2012

Feb. 16 (Bloomberg) -- Wal-Mart de Mexico SAB, Latin America’s largest retailer, advanced after Credit Suisse Group AG raised its recommendation on the stock to “outperform” from “neutral,” saying a pickup in consumer credit will buoy spending.

Walmex, as the Mexico City-based company is known, gained 1.4 percent to 40.14 pesos in Mexico City trading, the biggest increase since Jan. 31.

“Consumer spending in Mexico will accelerate,” Credit Suisse analysts led by Antonio Gonzalez wrote in a research note sent late yesterday. “Walmex will disproportionately benefit from a growing industry in years to come.”

While Mexican consumer sentiment has struggled to return to levels reached before the 2008 collapse of Lehman Brother Holdings Inc., the confidence gauge last month climbed the highest point since July. Mexican consumer credit jumped 23 percent in the last quarter of the year, compared to the same period in 2010, according to the latest data published by the National Securities and Banking Commission, known as CNBV.

Credit Suisse maintained its “outperform” recommendations for Organizacion Soriana SAB, Mexico’s second-largest grocery store chain, and Grupo Comercial Chedraui SAB.

The benchmark IPC index of 35 Mexican stocks rose 0.9 percent today after claims for U.S. jobless benefits unexpectedly dropped last week to the lowest level in four years. Mexico sends about 80 percent of its exports to the world’s biggest economy.

--Editors: Brendan Walsh, Richard Richtmyer

To contact the reporter on this story: Jonathan J. Levin in Mexico City at jlevin20@bloomberg.net

To contact the editor responsible for this story: David Papadopoulos at papadopoulos@bloomberg.net


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