Walmart Inc. ($WMT) Earnings (Q2 FY23)

 Walmart Inc. ($WMT) Earnings and Opinion:

Walmart is a company in the Consumer Defensive sector and operates in the Discount Stores industry. The company engages in the operation of retail, wholesale, and other units worldwide. Walmart was founded in 1945 and is currently headquartered in Bentonville, Arkansas. The company made its debut on the stock market in 1970. 

Walmart Earnings Results:

  • Revenues of $152.86B beating expectations of $150.99B
  • Gross Profit of $37.02B beating expectations of $36.09B
  • Operating Income of $6.85B beating expectations of $6.44B
  • Adjusted EPS of $1.77 beating expectations of $1.62
  • Inventory of 59.92B beating expectations of 54.23B
Opinion:
Walmart is currently moving higher in todays trading session after reporting earnings before the market opened this morning. The company had a solid earnings report and beat on a lot of the key metrics compared to consensus estimates. The biggest shocker to me was the fact that the guidance for next quarter revenues beat estimates, however it missed consensus estimates for the fiscal year. This was a big key to watch from this earnings report as Walmart had to cut guidance last quarter. I think retail is starting to pick up steam again and especially Discount Stores with back to school shopping coming back and a lot more easing of inflation. Walmart did have a lot more inventory on hand than the estimates expected, which means they aren't getting rid of all their inventory effectively. This is a surprise because they use a JIT inventory system which ships a product the second it is bought at a store. That is why I'm surprised to see so much inventory left on hand. If they are able to get rid of it effectively with as minimal spoilage as possible, the last two earnings reports for the fiscal year could cause the stock to soar. As far as valuation goes, P/E ratio is at 29.11 which is high compared to industry averages at around 12. The P/S ratio is at 0.67 which is higher than the industry average of 0.25. The current ratio isn't at the best valuation, but Walmart is very profitable so the debt doesn't worry me too much. In my opinion, Walmart may be a little overvalued currently. I think the company is doing a solid job but the growth is limited and it is more of a value play. I think there are better places to invest your money to get better returns than Walmart. The stock is not bad at all though, I would want to see some little improvements and see what they can do to overcome the supply chain challenges. 


*Information from Yahoo Finance, CMLVIZ, Consensus Guru

Comments

Post a Comment

Popular posts from this blog

Weekly Earnings Review: September 25, 2023- September 29, 2023

     It was a nice little break in the earnings report, but just like that we are back! We are slowly easing our way back into earnings season. However, this week marked the end of Q3 and September. September was a downturn from the rally we saw earlier in the year. There is a lot of stuff looming as the government is set to shut down on October 1st. The Fed is keeping a close eye on inflation but this weeks prints showed some signs of improvement. The average consumer is struggling as savings keep dwindling. In terms of our earnings, we just had two companies that reported this week. One is a warehouse style retailer and the other is a wide range consulting firm.  Tuesday, September 26, 2023 Costco Wholesale Corporation (COST)-     Costco beat expectations on both the top and bottom line. The stock saw a decline after the initial earnings report, but by the end of the week it has hit a new 52-week high. The revenue growth was impressive as it grew by a hair under 10%. The COGS growth
Read more

Weekly Earnings Review: October 16, 2023- October 20, 2023

      Well earnings season is finally among us, so we will start producing more beefier blog posts and cover a lot more companies over these next few weeks. I had one company report last week that I decided to throw into this weeks post, because I felt that it was pointless to make a post with just one boring company. With the inclusion of that company, we will cover 7 companies that report earnings this week and will give your our thoughts and opinions on how they performed during the quarter and the outlook. There is a lot of controversy going on with a war breaking out in Israel and the House of Representatives with out a speaker. This year seems to be the year of how geopolitics affect the market. There seems to be a lot of confusion with the outlook of the market right now, but inflation numbers still look to be fair and the earnings of major companies will be able to tell us a little bit more about where this is headed.  Thursday, October 12, 2023 Walgreens Boots Alliance (WBA)-
Read more

Weekly Earnings Review: November 27, 2023- December 1, 2023

Image
     Stocks continue to rise as we enter the final month of trading for the year. The S&P 500 and Nasdaq had another stellar month. Bond yields continue to fall, as interest rates have seemed to reach their peak. Estimates are all over the place when it comes to when cutting will start and how many cuts we will see next year. I added a new mantra to particular companies. I want to add some visual pieces to the post to entice the readers. Hope you guys enjoy the visuals and the excerpts. Stay investing! Monday, November 27, 2023 Zscaler (ZS)-      Zscaler continues to carry its momentum, as the company beat on both the top and bottom lines. The company achieved 40% growth on the top line and saw impressive growth on the bottom line as well. Management raised guidance and are expecting around 30% growth on both the top and bottom line. What is so impressive about this company is that they are achieving high growth and high profitability. This is a feat that a lot of software companie
Read more