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

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Zacks Equity Research
·3 min read
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Walmart (WMT) closed the most recent trading day at $143.75, moving -0.06% from the previous trading session. This change lagged the S&P 500's daily gain of 0.98%. At the same time, the Dow added 0.99%, and the tech-heavy Nasdaq gained 0.5%.

Investors will be hoping for strength from WMT as it approaches its next earnings release. In that report, analysts expect WMT to post earnings of $1.47 per share. This would mark year-over-year growth of 6.52%. Meanwhile, our latest consensus estimate is calling for revenue of $146.42 billion, up 3.35% from the prior-year quarter.

WMT's full-year Zacks Consensus Estimates are calling for earnings of $5.55 per share and revenue of $555.06 billion. These results would represent year-over-year changes of +12.58% and +5.93%, respectively.

It is also important to note the recent changes to analyst estimates for WMT. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

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. Within the past 30 days, our consensus EPS projection has moved 0.08% higher. WMT is currently sporting a Zacks Rank of #3 (Hold).

Digging into valuation, WMT currently has a Forward P/E ratio of 26.58. For comparison, its industry has an average Forward P/E of 22.94, which means WMT is trading at a premium to the group.

Also, we should mention that WMT has a PEG ratio of 4.83. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. Retail - Supermarkets stocks are, on average, holding a PEG ratio of 2.75 based on yesterday's closing prices.

The Retail - Supermarkets industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 81, putting it in the top 32% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow WMT in the coming trading sessions, be sure to utilize Zacks.com.


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