Walmart is poised to unveil its fiscal fourth-quarter earnings before the opening bell on Thursday, drawing significant attention from investors and analysts. The retail giant's robust performance in recent quarters has positioned it as a vital indicator of consumer health in the U.S. As the top grocer in the nation, Walmart's holiday-season results and its forecast for the year ahead are eagerly anticipated. This release comes on the heels of a dynamic holiday retail season and amid slight setbacks in January retail sales.
Despite a general slowdown in January, where retail sales dropped 0.9%, missing the Dow Jones estimate of a 0.2% decline, Walmart has maintained its upward trajectory. Over the past year, Walmart shares have surged approximately 83%, reflecting strong investor confidence. This growth has been fueled by its online sales, which have seen ten consecutive quarters of double-digit gains.
The holiday season proved fruitful across the retail industry, with sales rising 3.8% year over year, totaling $964.4 billion in November and December, according to the National Retail Federation (NRF). Historically, average sales growth during the holiday season from 2010 to 2019 stood at 3.6%, showcasing a consistent upward trend. Against this backdrop, Walmart's ability to attract customers with higher incomes has been particularly notable. CEO Doug McMillon highlighted that households earning over $100,000 accounted for 75% of market share gains in the third quarter.
Walmart's expected earnings per share stand at 64 cents, with projected revenue reaching $180.01 billion. These figures underscore the retailer's strong financial health and its strategic positioning in the market. The company's advertising business and third-party marketplace, although smaller than Amazon's, have contributed positively by driving higher margins than its traditional retail operations.
As Walmart prepares to disclose its holiday-season results, analysts have heightened their expectations. Simeon Gutman, a retail analyst at Morgan Stanley, recently raised Walmart's price target to $153, reflecting confidence in the retailer's sustained growth trajectory. Investors are keenly observing how Walmart will navigate potential challenges, including economic fluctuations and competitive pressures from other retail giants like Amazon.