Walmart’s Q1 Profit Falls, but Company Still Beats Expectations

Walmart Stock: Hits 20-Year High, But Is It All Shine?

Retail giant Walmart (WMT) announced its financial results for the first quarter of fiscal 2024, revealing a decrease in profit by 18.5 percent compared to the previous year. The decline was primarily attributed to substantial net losses on equity and other investments. However, the company managed to surpass analysts’ expectations for both adjusted earnings per share and quarterly revenues. Walmart also raised its guidance for the full year of 2024.

 

Walmart’s consolidated net income attributable to the company for the quarter amounted to $1.67 billion, or $0.62 per share, a decline from $2.05 billion, or $0.74 per share, in the same quarter last year. The results for this quarter included net losses on equity and other investments, amounting to $0.85 per share. However, excluding these items, adjusted earnings per share reached $1.47, compared to $1.30 per share in the previous year.

 

Analysts Estimations

Analysts polled by Thomson Reuters had estimated earnings of $1.32 per share for the quarter, which were surpassed by Walmart. The total revenue for the quarter, comprising net sales and membership and other income, grew by 7.6 percent to $152.30 billion. Revenues in constant currency also showed a growth of 7.7 percent, reaching $152.53 billion. Analysts had projected revenues of $148.65 billion for the quarter.

 

Net sales experienced a 7.6 percent increase, reaching $151.00 billion, while membership and other income rose by 1.2 percent to $1.30 billion compared to the previous year. Consolidated U.S. comp sales, excluding fuel, exhibited a growth of 7.3 percent.

 

Walmart Stock Performance

Walmart’s strong market performance was driven by various factors. Walmart U.S. comp sales saw a 7.4 percent increase, with net sales rising by 7.2 percent to $103.90 billion. The company attributed this growth to market share gains in the grocery sector. Walmart U.S. eCommerce sales experienced an impressive 27 percent increase, while Walmart Connect advertising saw a nearly 40 percent rise.

 

Sam’s Club comp sales rose by 7.0 percent, with net sales growing by 4.5 percent to $20.50 billion. Membership income also increased by 6.3 percent. Walmart International demonstrated positive growth as well, with net sales improving by 12.0 percent to $26.60 billion. In constant currency, net sales increased by 12.9 percent to $26.8 billion, largely driven by strong performance in China, Walmex, and Flipkart.

 

Looking ahead to the second quarter, Walmart anticipates adjusted earnings in the range of $1.63 to $1.68 per share, with consolidated constant currency net sales growth of approximately 4.0 percent. Analysts’ expectations for the quarter include earnings of $1.71 per share on revenue growth of 3.5 percent, amounting to $158.21 billion.

 

Walmart Stock Analysis & Forecast

According to 25 analysts, the average projected price for Walmart Inc over the next 12 months is USD 162.42. Analysts consider WMT Stock to be a Strong Buy. Stock Target Advisor’s analysis of Walmart Inc indicates a Neutral stance, considering 7 positive signals and 7 negative signals. As of the last closing, Walmart Inc’s stock price was USD 149.53. Over the past week, the stock price has decreased by -1.98%, while over the past month it has increased by +0.01%. In the last year, the stock price has shown a significant increase of +13.84%.

WMT Ratings by Stock Target Advisor

 

For Q1 2024, Walmart now projects adjusted earnings between $6.10 and $6.20 per share, with consolidated constant currency net sales growth of around 3.5 percent. Previously, the company had forecasted adjusted earnings in the range of $5.90 to $6.05 per share, with net sales growth of 2.5 to 3.0 percent. Analysts predict earnings of $6.79 per share for the year, with revenue growth of 3.3 percent, totaling $632.99 billion.

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