Part A of Case 4.2 analyzed the profitability and risk of Wal-Mart Stores for its fiscals 2006, 2007, and 2008. Part B of this case compares the profitability and risk ratios of Walmart and two other leading discount retailers, Carrefour and Target, for their 2006–2008 fiscal years.

Required
a. Walmart and Target follow somewhat different strategies. Walmart consistently has a higher ROA compared to Target. Using information in Exhibits 4.54 and 4.57, suggest reasons for these differences in operating profitability.
b. Walmart and Carrefour follow similar strategies. Walmart consistently outperforms Carrefour on ROA. Using information in Exhibits 4.54 and 4.57, suggest reasons for these differences in operating profitability.
c. Refer to Exhibit 4.55. Which firm appears to have used financial leverage most effectively in enhancing the rate of ROCE? Explain your reasoning.
d. Refer to Exhibit 4.56. Rank-order these firms in terms of their short-term liquidity risk. Do any of these firms appear unduly risky as of the end of fiscal 2008? Explain.
e. Refer to Exhibit 4.56. Rank-order these firms in terms of their long-term liquidity risk. Do any of these firms appear unduly risky as of the end of fiscal Year 4? Explain.