Wal-Mart Stores Inc.WMT

As the largest player in nearly all parts of its value chain, Wal-Mart's primary limiting factor in performance is its end customers--consumers--not vendors.

The recession is causing some consumers to trade down to Wal-Mart. According to the company, these customers have larger average ticket sizes because of the cost savings they experience by switching retailers.

Wal-Mart's reputation as a general retailer allows it to more easily shift its product mix to meet consumer demand compared with focused retailers. For example, as people eat more meals at home and spend less on discretionary entertainment, Wal-Mart can dedicate more floor space to groceries.

If the economic recovery is as mild as we expect, Wal-Mart should be able to continue its rapid growth internationally and slow but steady growth domestically.

As the current low-cost leader, Wal-Mart's moat would be very difficult to traverse without poor execution at the company, which would allow competitors to gain ground. Read more 

A large number of discrimination lawsuits and the potential for material health-care reform could lead to higher labor costs to support Wal-Mart's roughly 2 million employees.

International expansion can be perilous in any business, especially those that are consumer-facing, where local customs can be very important.

Expansion through acquisition, especially on the scale necessary for Wal-Mart to grow, can lead to the destruction of shareholder capital if the firm overpays or is rejected by local consumers.

A quicker-than-expected economic recovery could allow consumers to trade up to higher-priced retailers. Read more