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

Zacks Equity Research

Walmart (WMT) closed the most recent trading day at $115.81, moving -0.25% from the previous trading session. This change lagged the S&P 500's 0.11% gain on the day. At the same time, the Dow lost 0.09%, and the tech-heavy Nasdaq gained 0.2%.

Prior to today's trading, shares of the world's largest retailer had lost 2.85% over the past month. This has lagged the Retail-Wholesale sector's gain of 2.91% and the S&P 500's gain of 3.25% in that time.

Investors will be hoping for strength from WMT as it approaches its next earnings release, which is expected to be February 18, 2020. On that day, WMT is projected to report earnings of $1.44 per share, which would represent year-over-year growth of 2.13%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $142.66 billion, up 2.78% from the year-ago period.

WMT's full-year Zacks Consensus Estimates are calling for earnings of $4.98 per share and revenue of $525.58 billion. These results would represent year-over-year changes of +1.43% and +2.17%, respectively.

Investors might also notice recent changes to analyst estimates for WMT. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.11% higher. WMT is currently a Zacks Rank #2 (Buy).

Valuation is also important, so investors should note that WMT has a Forward P/E ratio of 23.3 right now. For comparison, its industry has an average Forward P/E of 13.82, which means WMT is trading at a premium to the group.

Meanwhile, WMT's PEG ratio is currently 4.7. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. WMT's industry had an average PEG ratio of 2.66 as of yesterday's close.

The Retail - Supermarkets industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 48, which puts it in the top 19% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual 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.

To follow WMT in the coming trading sessions, be sure to utilize Zacks.com.


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
Walmart Inc. (WMT) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.
 
Zacks Investment Research