Walmart Stock (NYSE:WMT)
Walmart stock (NYSE:WMT) took a significant hit on Tuesday despite the fact that the world’s largest retailer reported earnings for the fourth quarter that were better than analysts had anticipated. Despite this, Walmart issued a muted full-year profit forecast because it warned that consumers will continue to spend cautiously in a slowing economy.
Walmart reported that its adjusted earnings for the three months that ended in December came in at $1.71 per share, which is an increase of 11.8% compared to the same period last year and is significantly higher than the consensus estimate of $1.51 per share that was made by Wall Street analysts.
Walmart reported that its group revenues were estimated at $164.0 billion, which represents a 7.3% increase from the previous year and again beat the analysts’ estimates of $159.72 billion. The company reported that same-store sales in the United States increased by 8.3% compared to the previous year, easily beating the forecast of 5.8% made by Refinitiv.
Walmart stated that it anticipates adjusted earnings of between $1.25 and $1.30 per share during the retailer’s fiscal first quarter, which will end in April. Additionally, the company anticipates sales growth of between 4.5% and 5%. Walmart anticipates full-year sales will likely increase by 2.5% to 3% from 2022 levels, and the company’s earnings per share will likely fall somewhere between $5.90 and $6.05.
Investors Will Be Watching Retail Sector as Attention Turns to Walmart Earnings
Ahead of the opening bell, Walmart (NYSE:WMT) will report its earnings for the fourth quarter before the market opens. Shares of Walmart (NYSE:WMT) have been trending downward in pre-market trading.
It is anticipated that Walmart will report an adjusted bottom line of $1.51 per share, which is a decrease of approximately 2 cents from the total reported the previous year. Revenues are anticipated to increase by 4.5% to $159.72 billion.
Given Walmart’s breadth across the consumer spending sector, however, the most important factor for investors will be its near-term forecast for April quarter sales. Additionally, Walmart’s ability to push back on planned price increases from major packaged food and consumer brand groups in order to retain customers and maintain stable profit margins will also be critical.
According to Bradley Thomas, an analyst at KeyBanc Capital Markets, “We believe Walmart is well positioned to gain share in 2023,” with the primary driver being the company’s scale advantages in the grocery industry as well as its status as a low-price leader. “Although we anticipate a moderation in the coming quarters, we believe that grocery inflation will continue to support comparable sales.”
“We couldn’t be more thrilled with how things are going. The team turned in a productive final quarter for the year, and our results for the most recent two quarters demonstrate that they moved quickly and aggressively to address the inventory and cost challenges we encountered in the previous year “said CEO Doug McMilon. “The momentum that we built up in the third quarter has carried over into the fourth. This new fiscal year is going to get off to a good start for us.”
A price of $140.94 per share is projected to be the opening price for Walmart stock after they were marked 3.75% lower in pre-market trading immediately following the release of earnings information.
Featured Image: Unsplash @ veryinformed
