Walmart Reports Earnings Tomorrow. Here’s What to Expect. - Barron's

Photograph by Patrick T. Fallon/Bloomberg

Walmart is slated to report earnings on Thursday morning, before the start of regular trading.

Walmart stock (ticker: WMT) is up 7.7% this year, and has risen 16.4% in the past 12-month period. That’s ahead of the SPDR S&P Retail ETF (XRT), which is up 5% in 2019 and has fallen 5.4% in the past year.

Here’s a snapshot of Wall Street’s expectations and some recent history.

Last year was a tough one for Walmart, as investors worried that the retail giant was paying too dearly for growth as it battled Amazon.com (AMZN). Walmart stock was also caught up in the late 2018 selling wave, along with so much of the market.
The stakes are high for Walmart as it battles for a piece of the e-commerce pie, and the most recent earnings report in February showed that the company was making progress on this front, sending shares higher. Walmart also showed that it was winning more share in grocery (although that remains a competitive space.)
The post-earnings stock gains didn’t last long, although the company still received plenty of analyst praise. That month it also raised the dividend.
Walmart has continued to innovate, experimenting with new ways for shoppers to pay and providing services such as curbside pickup (along with mulling CBD products, according to some reports). It’s also potentially getting ahead of proposed legislation by raising the tobacco buying minimum age to 21.
Last month, the company’s deal with the U.K.’s J Sainsbury was blocked by regulators, although as Barron’s noted previously, walking away was always an option for Walmart.
Most recently the stock has been called one of the potentially safer retailers amid rising trade tensions.
Analysts are looking for Walmart to earn $1.02 a share on revenue of $124.44 billion. That compares with a consensus EPS estimate for $1.41 on revenue of $137.74 billion in the previous quarter. (Retailers’ fourth quarters are usually their most profitable, given the holiday shopping season.)
In the past decade, Walmart’s stock price has climbed 102%, only half the 208% gain in the S&P 500 over the same period.
Analysts are upbeat about Walmart stock in general, with 55% rating it a Buy or the equivalent rating, with an average price target of $109.32. Thirty-nine percent rate it at Hold, and just 6% have a Sell rating on the shares.
With the exception of one quarter, the fourth quarter of fiscal 2018, Walmart has beaten bottom-line expectations since the second half of 2015.
Walmart will host a conference call at 7 AM Eastern time Thursday.