UBS has a price target of US$53 for WMT, and gives some good info in today's report on the Wal-Mart operations in the America's " Mexico and Central and South America in particular. The problem UBS sees is one of the law of big numbers " that is, it gets harder for mega-corps like Wal-Mart to continue growing at the rate it has been.

That's fair, but through product line extension (food for example), marketing (e.g., Web sales) and geographic expansion (emerging economies), those numbers will likely remain strong for many years.

I do accept that the average PE multiple for Wal-Mart for the next ten years will likely be lower than existed for the past ten years. I think the same thing will happen for most large cap stocks.

But for Wal-Mart, I like the industry leadership, the management, the incredible purchasing and distribution systems, the corporate financial structure, the operating margins, the opportunity in selling to a growing middle class in the emerging economies, the prospects of selling via a new-style web that is coming, and so forth.

In a word, Wal-Mart is not a fad, and hence the stock should have a core position in many portfolios. What remains is to pick the right time to buy/buy more.

I use two methods, primarily.

First, (assuming the company is on my watch list as a Cara 100) I use a combined fundamental-quantitative approach in setting a price target. I look at earnings and dividend growth rates and estimates of average PE multiples in order to decide on price targets for 2 to 3 years out. Then I look at today's price and decide if my prospects of earning a total return on invested capital (capital growth plus dividends) could be +30 pct a year. If I can't see the likelihood of that scenario, then I simply lose interest " for now.

Second, I use technical indicators like Relative Strength Index (RSI) and MACD (Moving Average Convergence-Divergence) to tell me if the amplitude of the long cycle (3 to 5 year Kitchin Wave) is approaching a cycle bottom. As a trend and cycles analyst, I believe in the concept called Reversion to the Mean. So I seek to find a cycle bottom. When I see it, usually with a RSI below the 30 line on the Monthly price series data, then I switch to an analysis of the Weekly price series data, and then to the Daily data.

If on the basis of both forms of analysis, I think that the stock is worthy of purchase for my portfolio, I use a tactic based on contrarian market psychology. I buy into weakness and sell into strength. In trying to do that I use Stochastics (a form of the RSI oscillator). When the STO is bouncing along the bottom of the chart, all other factors in place, I buy.

At the point of purchase I am expecting (hoping!) that the talking heads and mass media are spouting a storyline that serves to cause the majority of traders to do precisely the opposite of what I want to do. For example, and you can check this out on May 16 2005 (a year ago), CNBC's Jim Cramer was screaming at his audience and throwing things against walls, and stuff, railing against the oils, so I smiled and quieting said to myself, ‘thank you Jim; you are a god-send. I wish you had ten times the huge audience you already have mustered.'

The market is us. If you don't take the time to observe life, and anticipate what "we" are likely to do in a situation, then you cannot become a good trader.

In trading, all the analysis to support a decision is done in advance. Execution is a decisive act. In trading prices, you seize the moment it happens to arrive.

Cara 100 GICS 30 Wal-Mart Stores, Inc. (WMT) (WMT) Financial Data (Value Line: WMT) Dow 30