Markets

Walmart (WMT) Dips More Than Broader Markets: What You Should Know

Walmart (WMT) closed the most recent trading day at $143.94, moving -1.57% from the previous trading session. This change lagged the S&P 500's daily loss of 0.66%. At the same time, the Dow lost 0.58%, and the tech-heavy Nasdaq lost 0.8%.

Prior to today's trading, shares of the world's largest retailer had gained 6.46% over the past month. This has lagged the Retail-Wholesale sector's gain of 9.09% and outpaced the S&P 500's gain of 5.22% in that time.

WMT will be looking to display strength as it nears its next earnings release. On that day, WMT is projected to report earnings of $1.18 per share, which would represent year-over-year growth of 1.72%. Our most recent consensus estimate is calling for quarterly revenue of $131.74 billion, up 2.93% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $5.35 per share and revenue of $551.08 billion. These totals would mark changes of +8.52% and +5.18%, respectively, from last year.

It is also important to note the recent changes to analyst estimates for WMT. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 1.28% higher within the past month. WMT currently has a Zacks Rank of #2 (Buy).

Digging into valuation, WMT currently has a Forward P/E ratio of 27.34. This represents a premium compared to its industry's average Forward P/E of 17.44.

We can also see that WMT currently has a PEG ratio of 4.85. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Retail - Supermarkets was holding an average PEG ratio of 2.59 at yesterday's closing price.

The Retail - Supermarkets industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 24, putting it in the top 10% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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