Walmart Investors Wary As Q3 Report Looms

PLUM3G

On Thursday, Walmart (WMT) is scheduled to report its Q3 earnings before market opening.

Despite the “comeback” that Walmart stocks’ performance for the past ten sessions, more than doubling its market in 2016—recovering from 30 percent losses in 2015— investors are cautious of buying ahead of the third-quarter profits report. This is because of the expected slight losses that the retail giant might face due to food deflation and emerging discount competitors.

Also, Walmart is currently diverting its spending into store remodels, distribution centers, and e-commerce improvements, and pulling back on store openings. Despite this, still, Walmart is at the top of its game when it comes to its operations, with its second quarter having the biggest gain in same-store sales in four years.

However, the Wall Street expects a 3 percent decline in its earnings, lowering to 96 cents per share on a 1 percent surge in revenue to $118.6 billion. In contrast, Barclays see the retail company to add an additional cent to the Q3 gains, seeing that new shoppers and better current-customer spending can be a potential catalyst for the quarter.

Walmart’s stock has an average hold rating, as seen by analysts, with a price target of $74.46. 4.5 percent higher compared to Friday’s close.

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