Should Walmart pick up a dollar chain?

For decades, Walmart has been a stock-market darling, able to post solid numbers in both good times and bad.

But results lately have been sluggish. In America, in particular, it’s facing tough competition from the likes of dollar stores.

So why doesn’t Walmart use its considerable heft to buy a dollar-store rival?

That’s what some analysts are wondering after Walmart on Thursday lowered its full-year profit guidance.

Purchasing a chain like Family Dollar, would allow Walmart to quickly add more stores in urban areas where it doesn’t have as many locations. Plus it would “fill in the blanks” of consumers that Walmart isn’t reaching.

If nothing else, dollar stores are “out-Walmarting” Walmart. A recent survey of shopping baskets at Family Dollar, Dollar General and Walmart found the dollar chains lowered prices faster than Walmart.

Prices at Family Dollar had fallen 3.4% in three months and 2.2% at Dollar General…but just 0.7% at Walmart.

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