Week's Winners & Losers: Walmart's Donkey Trouble; Disney Works More Magic

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Walmart proclaims that their shareholding ratio in E-commerce website
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Companies can make brilliant moves, but there are also times when things don't work out quite as planned. From another cheap swipe at the country's second-largest discounter to a timely analyst upgrade on the world's leading family entertainment provider, here's a rundown of the week's best and worst in the business world.

Walmart (WMT) -- Loser

A recall of donkey meat in China's Walmart stores may seem like an absurd story, but the real hook to the story is that the recall was done because fox DNA was found in the meat.

Donkey is a delicacy in China, and to maintain its status as the world's largest retailer, Walmart has to cater to local tastes. The recall may be making news closer to home given the oddity of fox meat being passed off as donkey meat by a Walmart supplier in China, but it's hurting the retailer's reputation in the world's most populous nation.

Disney (DIS) -- Winner

At least one analyst is feeling more upbeat about the family entertainment giant's prospects. Guggenheim's Michael Morris upgraded his rating on Disney from neutral to buy -- raising his price target from $77 to $87 -- on better than expected box office results for "Frozen" and "Thor 2."

He's also encouraged by how Disney's theme parks are faring in this improving economy -- visitors are flocking to them, as anyone who arrived at Florida's Magic Kingdom on New Year's Eve to find that it was turning guests away because it was operating at capacity could attest.

And you do know that Disney's new "Star Wars" movie is now slated to come out next year, right? The mouse just keeps getting richer.

Target (TGT) -- Loser

This just hasn't been the holiday shopping season Target was aiming for. The chain has already lost the trust of shoppers with the data breach that potentially exposed debit and credit card information on 40 million transactions during several weeks last month. Now even the store's own plastic is suspect.

The discount department store chain revealed on Tuesday that some gift cards sold during the holidays were not property activated. Target claims that the issue impacts less than 0.1 percent of the number of cards sold, but that's still one in a thousand shoppers who will be embarrassed when they attempt to use their cards.

Target's doing the right thing. It will honor the cards that weren't activated. Customers can also call the number on the back of the cards to verify that they have the right amount on them.

Wall Street -- Winner

The market itself was a big winner in 2013. The S&P 500 closed out the trading year with a 29 percent gain, making this the best return since 1997.

The strongest year on this side of the millennium was a refreshing surprise, especially when so many naysayers were bracing for the worst when 2013 began. Fears of rising interest rates and the end of a payroll tax break that had returned 2 percent of paychecks to earners in 2011 and 2012 threatened to derail the market's chances for a buoyant 2013.

However, anyone following the market for awhile knows that it pays to be a contrarian. All of those pundits figuring that global stock markets would be challenged when the year began merely provided a bigger pool of skeptics to be won over when consumer spending and home prices kept moving higher despite the initial headwinds.

Netflix (NFLX) -- Loser

Netflix bounced back in 2013, and its stock nearly quadrupled, but it's making a mistake by offering a cheaper monthly subscription plan to some new users. Reports indicate that the leading video service is testing out a plan that will set video buffs back just $6.99 a month, a buck less than Netflix's popular streaming solution.

The catch to the cheaper plan is that is only streams in standard definition and that it can only be seen on one screen at a time. The traditional $7.99 a plan includes high-def videos when feasible and it can be viewed by two family members simultaneously.

This test might sound like a reasonable idea if you're a frugal cord-cutter, but investors don't want to see Netflix making less money per account. Also, it sends the wrong message if Netflix is testing lower pricing tiers at a time when its flagship service seems to be doing just fine.

Motley Fool contributor Rick Munarriz owns shares of Netflix and Walt Disney. The Motley Fool recommends Netflix and Walt Disney. The Motley Fool owns shares of Netflix and Walt Disney. Try any of our newsletter services free for 30 days.

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impactvqi

Walt Disney needs the mouse to roar this year

January 03 2014 at 11:21 PM Report abuse +1 rate up rate down Reply