Belus Capital's Brian Sozzi Says Wal-Mart's Q2 Earnings Report is Rancid

In a note released early Thursday morning, Belus Capital's CEO and Chief Equities Strategist, Brian Sozzi didn't hold anything back as he tore apart Wal-Mart Stores Inc.

following the company's second quarter earnings report. Sozzi says the quarter was not only "stinky" for the institutional investor, due to the company's serious structural issues, but also for the "widows and orphans" who were led to believe Wal-Mart's dividend and repurchase program made the stock an attractive long-term holding. Among the list of disappointments on Sozzi's list were a continued decline in traffic at both Sam's Club and Wal-Mart U.S., sales growth was outpaced by inventory growth, ROI dropped again from 17.9 to 16.6 percent, and a decline in operating margins both in the U.S. and internationally. Stressing his point, Sozzi said, "The ins and outs of the second quarter warrant continued avoidance of Wal-Mart shares." Belus Capital currently rates Wal-Mart at Sell with a $71 price target.