The Anticipation for Q1
As we await Walmart’s Q1 results following a strategic 3-1 stock split in February, the stage is set for a deep dive into the consumer landscape, mirrored by the impending report from retail giant Target. With this backdrop, let’s dissect the opportune moment to delve into Walmart’s stock portfolio as Q1 earnings loom.
Q1 Projections
According to Zacks assessments, Walmart’s Q1 earnings are forecasted to climb by 6% to $0.52 per share, paired with predictions of a 4% surge in quarterly sales to $159.33 billion. Even more alluring is Zacks ESP, hinting at Walmart potentially outshining earnings expectations with Q1 EPS estimated at $0.54 – a 2% upsurge compared to Zacks Consensus.
Expansion & Prediction
Walmart’s earnings arc is plotted to ascend by 6% in the ongoing fiscal year of 2025, further projecting an 8% lift in FY26 to reach $2.55 per share. This growth narrative extends to total sales, poised to scale up by 4% in FY25, and another 4% in FY26, set to hit $699.86 billion.
Performance Analysis & Market Value
Boasting accessible pricing and viewed as a shield against inflation, Walmart’s stock has surged by +18% in the last year, a tad behind S&P 500’s +26% but eclipsing Target’s -1%. Impressively, YTD figures show a +14% upturn for Walmart, painting a picture more vibrant than the benchmark’s +10% and even outshining TGT at +11%.
From a valuation standpoint, Walmart’s forward P/E ratio of 25.6X may seem slightly premium alongside S&P 500’s 21.9X, but notably above Target’s 17.1X. A closer look at price-to-sales ratios unveils a forward P/S ratio of 0.7X for Walmart, comfortably below the desired level of less than 1X and closely aligned with Target, while significantly trailing S&P 500’s 3.8X.
Parting Thoughts
Heading into the Q1 unveiling, Walmart’s stock secures a Zacks Rank #3 (Hold). While the company’s valuation hints at potential buying windows in the future, steadfast investors are poised to reap the rewards of the current stance.
Curious onlookers may wonder – is now the apt time to plunge into Walmart’s stock?
