Early Tuesday morning, Walmart Inc. stock hit a new high. This came after the retail giant extended its streak of beating earnings estimates and raised its full-year outlook, noting strength in e-commerce and rising in-store sales.
Walmart’s U.S. business saw an increase in general goods sales, which means people are once again buying things they don’t have to. Also, market share grew, mostly due to families with higher incomes.
Walmart’s Chief Financial Officer, John David Rainey, said during a conference call to talk about the findings, “U.S. customers remain resilient.” He also said that customer behavior has been “largely consistent over the last four to six quarters.”
Early Tuesday morning, the stock WMT 4.25% went up 2.6%, which was more than the DJIA -0.49% premarket gainers. That meant the stock was likely to open higher than the record high of $85.50 set on November 13.
In a statement, CEO Doug McMillon said, “In the U.S., in-store volumes grew, pickup from store grew faster, and delivery from store grew even faster.”
Net income went up from $453 million, or 6 cents per share, in the same quarter last year to $4.58 billion, or 57 cents per share.
Taking out one-time items, adjusted earnings per share of 58 cents were higher than the 53 cents predicted by FactSet. This is the ninth quarter in a row that the bottom line has been higher than expected.
Total revenue rose 5.5% to $169.59 billion, which was more than the $167.69 billion that FactSet predicted. This was due to a 27% rise in e-commerce sales and a 16.1% rise in membership and other income. Walmart has now done better than expected in terms of sales for 19 quarters in a row.
The U.S. business of Walmart had sales rise 5% to $114.9 billion, which was more than the $113.61 billion that was expected.
Compare-store sales, which are sales at stores that have been open for at least a year, went up 5.3%, which was higher than the 3.8% growth that FactSet predicted. This was because the number of transactions went up 3.1% and the average ticket value went up 2.1%.
Walmart said that sales of general goods were flat in the previous quarter, but that they had seen “positive inflection” for the first time in 11 quarters.
Sam’s Club U.S., Walmart’s shopping club for members, saw net sales rise 3.9% to $22.9 billion, which was about what was expected.
It was the biggest surprise in two years when comparable-store sales went up 7%, much more than the 4.1% rise that was expected. Transactions went up 6.4% and the average ticket went up 0.5%.
International sales went up 8% to $30.3 billion, which was more than the $30.1 billion that FactSet predicted. Flipkart, Walmex, and China all saw growth, which was the main driver.
The company raised its hopes for adjusted earnings per share for the whole year of 2024 from $2.35 to $2.43 to $2.42 to $2.47. They also raised their hopes for net sales growth from 3.75% to 4.75% to 4.8% to 5.1%.
Analysts are pointing out Walmart’s strong growth. “We think [Walmart] remains well-positioned going into the holiday season,” Corey Tarlowe, an analyst at Jefferies, wrote in a note that was made public after the results. Tarlowe also said that strong traffic patterns at Walmart U.S. and Sam’s Club U.S., where sales went up 3.1% and 6.4%, respectively, should continue.
An expert at D.A. Davidson named Michael Baker wrote in a note, “Momentum continues at Walmart.” Walmart is continuing to gain market share because they are taking advantage of a business environment that fits their value offering and a number of internal drivers that are leading to better business practices.
The stock has gone up 60% so far this year as of Monday. The Consumer Staples Select Sector SPDR exchange-traded fund (XLP 0.11%) has gone up 11.8%, and the Dow Jones Industrial Average (DJIA -0.48%) has gone up 23.6%.
