Wal-Mart Stores Inc. is winning the lowest borrowing costs this year as its AA credit rating offsets challenges ranging from a corruption probe to reports of thinly stocked shelves.
The world’s largest retailer, which has $5 billion of debt maturing through October, yesterday sold an equal amount of bonds in a four-part offering that included the lowest coupon on three-year notes in 2013, according to data compiled by Bloomberg. Wal-Mart’s sale adds to a supply of AA-rated debt that has declined to 11 percent of the $4 trillion U.S. corporate market from 18 percent three years ago.
The company’s weighted average coupon of 2.09 percent on yesterday’s transaction is about half the 4.02 percent paid on its $3.69 billion of dollar-denominated debt maturing this year, Bloomberg data show.
Wal-Mart’s in-stock shelf availability is at historically high levels and averages between 90 percent and 95 percent, Hargrove said.