Menu
May 26, 2023 : Walmart (WMT) delivered impressive results for the first quarter, prompting an upward revision in its full-year outlook. The retail giant reported a remarkable 26% surge in online sales, contributing to a 7.7% year-over-year increase in revenue, totaling $152.3 billion. This figure surpassed the analyst average by $4.4 billion, underscoring the success of Walmart’s substantial investments in bolstering its online presence.
Following this news, Walmart’s stock experienced a 1.5% rise, reaching $151.76, while Dow and S&P 500 futures saw modest gains ranging from 0.1% to 0.2%.
The company’s strong performance was driven by 7.4% growth in comparable sales and a record influx of new members at its Sam’s Club grocery stores. Walmart also gained market share in the grocery sector, particularly among wealthier customers, further fueling its revenue growth. CEO Doug McMillon expressed satisfaction with the results, highlighting the successful expense leverage, operating margin expansion, and profit growth that outpaced sales.
Adjusted earnings per share stood at $1.47, surpassing Wall Street’s consensus by 15 cents or 11% for the quarter.
Looking ahead, Walmart raised its full-year outlook. Shareholders can now anticipate adjusted earnings per share ranging from $6.10 to $6.20, compared to the previously stated range of $5.90 to $6.05. Consolidated net sales are also expected to rise by 3.5%, exceeding the earlier projection of 2.5% to 3%.
While the shift towards a greater focus on the grocery division from general merchandise will result in a decline of 18 basis points in gross margin to 23.7%, operational expenses are set to decrease by 58 basis points to 20.4%.
During the first quarter, Walmart repurchased $686 million in stock, leaving $18.6 billion available for repurchasing under the current mandate.
Market analysts predict a positive trajectory for Walmart’s stock, emphasizing surpassing the resistance level of $153.50. Failure to break this level could lead to a potentially concerning double-top pattern. Conversely, a successful breakout could pave the way for a retest of the range high at $160, observed in April of the previous year. In a retest failure, support is anticipated at $146.50.
