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Stock Market News: Wal-Mart Sees E-Commerce Growth, Medtronic Looks Healthy

Dan Caplinger, The Motley Fool

Tuesday morning brought a bit of a letdown for the stock market, as major indexes pulled back from their big gains from before the holiday weekend. As of 11 a.m. EST, the Dow Jones Industrial Average (DJINDICES: ^DJI) was down 32 points to 25,851. Elsewhere, the S&P 500 (SNPINDEX: ^GSPC) lost a fraction of a point to 2,775, but the Nasdaq Composite (NASDAQINDEX: ^IXIC) rose 8 points to 7,480.

Earnings season has continued to give a largely positive reading on the U.S. economy, and certain companies releasing their latest financials today had some encouraging things to add. Walmart (NYSE: WMT) and Medtronic (NYSE: MDT) issued their quarterly reports Tuesday morning, and although they're in very different industries, both showed signs of strength heading into 2019.

The big-box giant heads for the e-commerce world

Shares of Walmart jumped 3% after the retail giant released its fourth-quarter financial report. News from the Arkansas-based big-box retailer was good, with revenue growing 2% and adjusted earnings per share rising 6% from year-earlier levels. Comparable sales in the U.S. climbed 4.1%, accelerating from its 2.8% pace in the fourth quarter of the previous year on solid results from the company's namesake Walmart stores and its Sam's Club warehouse locations.

Walmart CEO Doug McMillon attributed the success to the company's strategic vision. "Progress on initiatives to accelerate growth, along with a favorable economic environment," McMillon said, "helped us deliver strong comp sales and gain market share."

Multiple shoppers near the entrance of a Walmart store.

Image source: Walmart.

The CEO also pointed to Walmart's progress in what he described as "the work we're doing to reach customers in a more digitally connected way." E-commerce sales soared 40% for the full year from last year's levels, and Walmart now offers conveniences like grocery pickup and delivery services in hundreds of its locations nationwide. Those services and other digital shopping options are becoming more important in attracting and keeping customers.

Shareholders will also reap the rewards of Walmart's performance in a tangible way, as the company increased its quarterly dividend by $0.01 per share to $0.53. That's a fairly minimal boost, but with projections for 3% sales growth and comps of 2.5% to 3% for Walmart in the coming year, investors are pleased with the progress that the company has made in making its transition toward an increasingly digital world.

Medtronic sees a good year ahead

Medtronic shares were slightly higher following the release of the medical device producer's fiscal third-quarter financial report. The company reported sales growth of 2.4% and adjusted earnings per share gains of about 10%, despite seeing pressure from currency headwinds and relatively weak performance from Medtronic's cardiac and vascular group.

Medtronic's strongest growth came from its minimally invasive therapies and restorative therapies groups, and CEO Omar Ishrak also pointed to good conditions in emerging markets in helping bolster the company's overall gains. Poor sales of cardiac rhythm and heart failure-preventing devices weighed on Medtronic's results, but the medical device giant saw strong demand for products targeting respiratory, gastrointestinal, and renal conditions. Brain therapy devices posted double-digit percentage gains due largely to various neurosurgical and neurovascular products.

Investors are optimistic that Medtronic will soon make more of a splash in the robotic surgery area. After having made key acquisitions to bolster its presence in the business, Medtronic has the resources and ability to challenge other companies that have been highly successful with their robotic systems. That's an area that Medtronic can use to offset headwinds elsewhere, and shareholders hope that the medical device company can keep making strides in that direction. In the meantime, increased guidance for revenue growth and adjusted earnings kept investors happy about Medtronic's prospects.

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Dan Caplinger has no position in any of the stocks mentioned. The Motley Fool owns shares of Medtronic. The Motley Fool has a disclosure policy.