Walmart (WMT) Stock Attains All-Time High Before Thursday’s Earnings

TLDR

• Walmart stock hit an all-time high of $134.71, up 37% over the past year
• Options traders expect up to a 5% swing this week following Thursday’s earnings report
• Q1 revenue is expected at $174.94 billion, up ~6% year-over-year; EPS est. at 66 cents
• E-commerce sales are projected to have grown around 22% in the quarter
• Analyst price targets average just above $140, with 10 out of 11 analysts rating the stock a Buy

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(SeaPRwire) –   Walmart stock reached a new all-time high of $134.71 on Monday, as investors prepare for the retailer’s first-quarter earnings announcement scheduled for Thursday morning before the market opens.

Walmart Inc., WMT

The stock has risen approximately 20% since January 1, making it one of the top-performing large-cap retailers this year.

According to current options pricing, traders anticipate a potential movement of up to 5% in either direction by week’s end. An upward move would push WMT above $139—surpassing its February record—while a 5% decline would bring it down to around $127.

Thursday’s earnings release marks Walmart’s first under new CEO John Furner, who assumed leadership in February. The results will provide Furner with an opportunity to outline his strategic priorities for the company.

Wall Street forecasts first-quarter revenue of $174.94 billion, reflecting nearly a 6% increase compared to the same period last year, based on data from Visible Alpha. Adjusted earnings per share (EPS) are expected to be 66 cents, an improvement of five cents from the prior-year quarter.

Comparable store sales are anticipated to rise by 3.8%, and e-commerce sales are predicted to climb about 22%.

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What Analysts Are Saying

Analyst sentiment remains overwhelmingly positive toward Walmart. Among the 11 analysts covered by Visible Alpha, ten maintain a Buy rating, while only one holds a Neutral stance. The average price target stands slightly above $140.

UBS continues to recommend a Buy with a target of $147, while TD Cowen increased its target to $150, also assigning a Buy rating. KeyBanc reaffirmed an Overweight rating, citing Walmart’s growing market share.

Oppenheimer anticipates a strong quarter but expects Walmart may keep its full-year guidance unchanged, given ongoing concerns about persistent elevated fuel costs.

Morgan Stanley believes Walmart is well-positioned to capitalize on consumers trading down due to inflation pressures squeezing household budgets.

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The Inflation Angle

Rising prices have proven beneficial for Walmart. As more American shoppers seek value, both foot traffic and average transaction sizes have performed better at Walmart than at some higher-priced competitors.

This quarter arrives amid continued high inflation and fuel costs, partly driven by geopolitical tensions such as the Iran conflict. Earnings reports from Walmart and other retailers this week could offer greater insight into how consumer behavior is evolving.

Walmart has consistently raised its dividend for 31 consecutive years. Currently, the stock trades at a P/E ratio of 49.11, which InvestingPro identifies as overvalued relative to its estimated fair value.

The company currently holds a market capitalization of $1.07 trillion.