Walmart shares fall for a fourth straight session on Thursday, quarterly results beat as same-store sales growth, e-commerce support

November 16, 2018 8:06 am

Walmart Inc’s (WMT) quarterly revenue and profit, reported on Thursday, outstripped Wall Street estimates, supported by strong sales growth at stores as well as on-line. The retailer also revised up its full-year earnings forecast.

Walmart shares closed lower for a fourth consecutive trading session in New York on Thursday. It has also been the steepest daily loss since October 31st. The stock went down 1.96% ($1.99) to $99.54, after touching an intraday low at $98.63, or a price level not seen since October 26th ($98.02).

Shares of Walmart Inc have risen 0.80% so far in 2018 compared with a 2.12% gain for the benchmark index, S&P 500 (SPX).

In 2017, Walmart’s stock surged 42.87%, thus, it outperformed the S&P 500, which registered a 19.42% return.

Walmart’s total revenue, excluding currency fluctuations, surged 2.4% year-on-year to $126.1 billion during the third quarter. The latter compares with a median analyst estimate of $125.56 billion.

The company said that sales at US stores, which are open for more than 12 months, had grown 3.4% during the third quarter from a year earlier. The figure did not take into account changes in fuel prices. In comparison, analysts on average had expected a 2.87% growth in comparable sales.

At the same time, sales from e-commerce registered an annual growth of 43% during the third quarter, following another 40% increase in the prior three-month period.

“Online grocery continues to grow, our customers continue to like it,” Walmart’s Chief Financial Officer Brett Biggs said in an interview for Reuters.

“On the site itself, search is better, the site is better, we are adding brands, we have added over 2,000 brands in the past few months, pricing continues to be sharp so all these things together have contributed to the performance,” he added.

Net income attributable to shareholders went down to $1.71 billion during the third quarter, from $1.75 billion during the same period a year earlier.

Meanwhile, the retailer’s earnings per share, excluding special items, were reported at $1.08 during the latest quarter, which exceeded the median analyst forecast pointing to adjusted earnings of $1.01 per share.

Walmart also revised up its adjusted earnings forecast for fiscal year 2019 to a range of $4.75 to $4.85 per share from a range of $4.65 to $4.80 per share, as expected previously.

According to CNN Money, the 31 analysts, offering 12-month forecasts regarding Walmart Inc’s stock price, have a median target of $103.00, with a high estimate of $120.00 and a low estimate of $90.00. The median estimate represents a 3.48% upside compared to the closing price of $99.54 on November 15th.

The same media also reported that 19 out of 35 surveyed investment analysts had rated Walmart Inc’s stock as “Hold”, while 12 – as “Buy”.

Weekly Pivot Levels

By using the traditional method of calculation, the weekly levels of importance for Walmart Inc (WMT) are presented as follows:

Central Pivot Point – $104.03
R1 – $107.43
R2 – $109.30
R3 – $112.70
R4 – $116.10

S1 – $102.16
S2 – $98.76
S3 – $96.89
S4 – $95.02

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