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

Zacks Equity Research
Dollar Tree (DLTR) doesn't possess the right combination of the two key ingredients for a likely earnings beat in its upcoming report. Get prepared with the key expectations.

Walmart (WMT) closed the most recent trading day at $102.93, moving +0.49% from the previous trading session. This change outpaced the S&P 500's 0.05% gain on the day. Elsewhere, the Dow gained 0.26%, while the tech-heavy Nasdaq added 0.3%.

Heading into today, shares of the world's largest retailer had gained 2.78% over the past month, lagging the Retail-Wholesale sector's gain of 4.01% and the S&P 500's gain of 3.08% in that time.

Investors will be hoping for strength from WMT as it approaches its next earnings release. On that day, WMT is projected to report earnings of $1.02 per share, which would represent a year-over-year decline of 10.53%. Our most recent consensus estimate is calling for quarterly revenue of $125.24 billion, up 2.08% from the year-ago period.

WMT's full-year Zacks Consensus Estimates are calling for earnings of $4.75 per share and revenue of $528.21 billion. These results would represent year-over-year changes of -3.26% and +2.68%, respectively.

Investors might also notice recent changes to analyst estimates for WMT. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

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.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. WMT currently has a Zacks Rank of #3 (Hold).

In terms of valuation, WMT is currently trading at a Forward P/E ratio of 21.55. For comparison, its industry has an average Forward P/E of 14.96, which means WMT is trading at a premium to the group.

Also, we should mention that WMT has a PEG ratio of 4.71. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Retail - Supermarkets industry currently had an average PEG ratio of 1.41 as of yesterday's close.

The Retail - Supermarkets industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 19, putting it in the top 8% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


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