Markets

Walmart (WMT) Outpaces Stock Market Gains: What You Should Know

Walmart (WMT) closed at $132.01 in the latest trading session, marking a +1.92% move from the prior day. This change outpaced the S&P 500's 1.34% gain on the day. Elsewhere, the Dow gained 2.13%, while the tech-heavy Nasdaq added 0.94%.

Heading into today, shares of the world's largest retailer had gained 9.69% over the past month, lagging the Retail-Wholesale sector's gain of 11.54% and outpacing the S&P 500's gain of 3.92% in that time.

Wall Street will be looking for positivity from WMT as it approaches its next earnings report date. In that report, analysts expect WMT to post earnings of $1.22 per share. This would mark a year-over-year decline of 3.94%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $133.97 billion, up 2.76% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $4.93 per share and revenue of $545.78 billion, which would represent changes of 0% and +4.16%, respectively, from the prior year.

Any recent changes to analyst estimates for WMT should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about 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, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. WMT is currently a Zacks Rank #3 (Hold).

Digging into valuation, WMT currently has a Forward P/E ratio of 26.26. This valuation marks a premium compared to its industry's average Forward P/E of 17.7.

Also, we should mention that WMT has a PEG ratio of 4.95. 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 2.41 at yesterday's closing price.

The Retail - Supermarkets industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 90, putting it in the top 36% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our 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.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


Click to get this free report

Walmart Inc. (WMT): Free Stock Analysis Report

To read this article on Zacks.com click here.

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

Latest Markets Videos

    Zacks

    Zacks is the leading investment research firm focusing on stock research, analysis and recommendations. In 1978, our founder discovered the power of earnings estimate revisions to enable profitable investment decisions. Today, that discovery is still the heart of the Zacks Rank. A wealth of resources for individual investors is available at www.zacks.com.

    Learn More