Walmart Stock To Trade Lower Post Q3 Results?

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Walmart (NYSE: WMT), the world’s largest retailer operating discount stores, supercenters, neighborhood markets and Sam’s Club Warehouse, is scheduled to report its fiscal third-quarter results on Tuesday, Nov. 15. We expect WMT stock to trade at a potential revenue and earnings decrease. in fiscal third quarter results. The company is grappling with excess inventory, rising costs and supply chain issues this year. It is trying to reduce excess inventory by marking down, but that has hurt its profit margins. We expect this trend to continue for the next few quarters.

Despite Walmart
Reporting comparable sales growth (excluding fuel) in the US at 6.5% for the period ending July 31 (which is more than double the growth seen in the first quarter), the company did not raise its guidance for the second half. year. In other words, it still anticipates comparable US sales growth of only 3%. It also forecasts 4.5% sales growth for adjusted EPS and a decline of between 9% and 11%. This shows that the company is cautious about the rest of 2022, and rightly so.

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Our forecast suggests that Walmart’s valuation is $134 per share, down 6% from its current market price. View our interactive dashboard analysis WMT Earnings Preview: What to expect in Q3? for more information.

(1) Revenue is expected to be slightly below the consensus estimate

Trefis estimates Walmart’s Q3 2023 revenue to be about $146 billion, slightly below consensus estimates. In the first two quarters of 2023, Walmart brought in $294 billion in revenue, a 5% increase from the same period in FY22. In addition, thanks to higher inventory, increased liabilities and increased spending on property and equipment, free cash flow was $1.7 billion in the first six months. This was significantly lower than the $7.4 billion in free cash flow in the same period a year ago.

we predict Walmart’s Revenue To be $600.5 billion for fiscal year 2023 (year ended January 2023), up 4.8% annually.

(2) EPS likely to be slightly below consensus estimates

WMT’s Q3 2023 earnings per share is expected to be $1.30 per Trefis analysis, slightly below consensus estimates. Rising costs and expenses coupled with lower gains from equity investments drove profit growth for Walmart this year. As a result, its adjusted earnings per share declined 12% to $3.07 during the same period, due to unrealized gains and losses on the company’s equity and investments in Brazil.

(3) The stock price is estimated to be less than the current market price

going by us Walmart’s ValuationWith an EPS estimate of about $5.88 in fiscal year 2023 and a P/E multiplier of 22.8x, this translates to a price of $134, which is 6% lower than the current market price.

It’s helpful to see how its mates stack up. WMT Peers Shows how Walmart’s stock compares against peers on key metrics. You’ll find other valuable comparisons for companies across industries here. peer comparison,

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