Walmart may just be a pit stop for high-income consumers.
Even though affluent shoppers helped drive the retailer's latest beat on quarterly results, former Walmart U.S. CEO Bill Simon warns they'll be hard to keep.
"The Walmart experience is better than it used to be, but it's still not a premium experience. Walmart is built on convenience, cost and assortment. Not on service," he told CNBC's"" on Thursday."As the economic challenges abate... service will become more important than convenience and price. And, we'll see a shift back of some of the consumers. That's the bubble.
"The challenge is that the tailwinds that have come from food inflation that have pushed Walmart along will reverse eventually," said Simon, who sits on the boards ofIf meditation hasn't worked for you, here's why you should try againDespite his bubble warning, Simon thinks Walmart is a"great investment" over the next 12 months.
"As long as there's inflation and those tailwinds that come from particularly from food inflation, more traffic will come to the Walmart store," said Simon. But he thinks the stock may hit a rough spot in 24 months as inflation comes down and higher-end consumers move away from shopping at discount retailers.
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