When analysts see good companies or potentially good companies, analysts like Max Salk would want to stick with it for the long haul. Of course, analysts like Max Salk also need to see what makes them compelling. He needs to see why they will grow and be a wonderful company in the future as well. One can see that this may be true if they see that the company is in the same type of environment to see gains, as they were within the past. Said in a different manner, if the future is going to be like the past and the present, then the company may be a viable one to invest in if it did well within specific conditions.
An investment analyst like Max Salk would see that Walmart won over the past for a variety of reasons. Sam Walton, the founder of Walmart, doubled down and increased sales volumes by lowering prices. Lowering prices allowed him to bring in more customers and stay competitive with others. Of course, lower prices meant that he would have to lower his profit margin as well. Lowering the profit margin would work out over the long term if the company was able to grow, attract more customers, increase their cash flows and push out some of the competition within this manner.
The founder would shortly branch off from one store and add another store within the state of Arkansas. Just fifteen or so years later, the company would have about 24 stores and would be a major store within the state of Arkansas. Sales would increase to more than $10 million. Just a year later, the company would open up stores in other states across the United States. It would stay focused on the same strategy. The company would have already gone public and would conduct stock splits when it was only operating in a few states at the time.
The company would then progress to also moving forward and acquiring a couple of companies that were in line with its vision. The company would see value within these stores and would then move forward to expanding into other markets as well. The company kept it simple and focused on specific products at the start and then grew its specialized stores. After it grew to a specific number of stores would it then add on more product lines.