How to Buy Walmart Stock: What You Need to Know

On the other hand, there were a total of 48 hedge funds with a bullish position in WMT a year ago. With hedgies’ capital changing hands, there exists a select group of key hedge fund managers who were upping their holdings substantially (or already accumulated large positions). Walmart is the nation’s largest grocery retailer by a wide margin. Its stores are packed with goods ranging from clothing to electronics that are priced to be affordable. You don’t go to Walmart for premium brands and high-end products.

Walmart and Target aren’t known to release such market-moving results in between earnings reports — which adds a level of uncertainty to the broader stock market. However, there are reasons to believe that Walmart’s guide down wasn’t much of a surprise at all. Here’s how to digest Walmart’s guidance cut and why the stock could be a buy now.

WMT Company Calendar

The financial health and growth prospects of WMT, demonstrate its potential to outperform the market. Recent price changes and earnings estimate revisions indicate this would not be a good stock for momentum investors with a Momentum Score of D. WMT’s Q earnings per share is expected to be $1.42 per Trefis analysis, marginally above the consensus estimate of $1.40. The retailer’s EPS declined 32% y-o-y to $2.48 in the fiscal first half. It is worth mentioning that online services that have gained steam, such as curbside pickup, require additional labor – translating to higher labor costs. And, Walmart has not been passing these costs on to its customers, even as more take advantage of the convenience of shopping online.

If you’re considering buying shares of Walmart stock, here’s how to do it and what you’ll need to know before you decide. Working with an adviser may come with potential downsides such as payment of fees (which will reduce returns). There are no guarantees that working with an adviser will yield positive returns. The existence of a fiduciary duty does not prevent the rise of potential conflicts of interest. An author, teacher & investing expert with nearly two decades experience as an investment portfolio manager and chief financial officer for a real estate holding company.

Should You Buy Walmart Stock Given What’s Going On In 2022?

The VGM Score are a complementary set of indicators to use alongside the Zacks Rank. It allows the user to better focus on the stocks that are the best fit for his or her personal trading style. An industry with a larger percentage of Zacks Rank #1’s and #2’s will have a better average Zacks Rank than one with a larger percentage of Zacks Rank #4’s and #5’s. As an investor, you want to buy stocks with the highest probability of success. The scores are based on the trading styles of Value, Growth, and Momentum.

After the P/E ratio, it’s one of the most common valuation metrics. The Growth Scorecard evaluates sales and earnings growth along with other important growth measures. This includes measuring aspects of the Income Statement, Statement of Cash Flows, the Balance Sheet, and more. Some of the items you’ll see in this category might look very familiar, while other items might be quite new to some. The ever popular one-page Snapshot reports are generated for virtually every single Zacks Ranked stock.

The disadvantage is that the fees are high compared to investing apps and online brokerages that offer no-commission trades. Also, you have no say in the price you pay or the price you sell at. Computershare simply completes your buy and sell orders as it receives them. Walmart’s top line expansion in the recent quarter was satisfactory. It is clear that price-conscious consumers are returning to Walmart’s stores in light of tightening purse strings as a result of inflationary cost pressures.

Consumers Buckle Down

Walmart’s defensive characteristics certainly came in handy last year. The S&P 500 generated a total return (price change plus dividends) of -18.1% in 2022, a historically bad result. On the other hand, Walmart’s total return came to -0.5% – or essentially flat – to beat the broader market by more than 17 percentage points. While all investments carry downside risk, WMT stock is arguably as close to a no-brainer as you can get.

Once again, cash flow is net income plus depreciation and other non-cash charges. Projected EPS Growth looks at the estimated growth rate for one year. It takes the consensus estimate for the current fiscal year (F1) divided by the EPS for the last completed fiscal year (F0) (actual if reported, the consensus if not). Cash Flow per share ($/share) calculates the amount of incoming cash vs. the amount of outgoing cash for a company. It’s then divided by the number of shares outstanding to determine how much cash is generated per share. Even the strongest business will fail to generate solid investment returns if it is priced too high.

• When it comes to blue chip stocks that pay dividends and play defense, Walmart’s (WMT) reputation is pretty tough to beat.
• The so-called Great Recession started in December 2007 and lasted through mid-2009.
• Other factors, such as our own proprietary website rules and whether a product is offered in your area or at your self-selected credit score range can also impact how and where products appear on this site.
• The company is scheduled to release its next quarterly earnings announcement on Tuesday, November 21st 2023.
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If the volume is too light, in absolute terms or for a relatively large position, it could be difficult to execute a trade. This is also useful to know when comparing a stock’s daily volume (which can be found on a ticker’s hover-quote) to that of its average volume. A rising stock on above average volume is typically a bullish sign whereas a declining stock on above average volume is typically bearish.

Prepare for lackluster profits from Walmart

The challenge for Walmart is that it has to predict customer demand months in advance. Supply chain disruptions and increased demand during the pandemic pressured Walmart and other retailers to order ahead of time and carry larger inventories. But when it’s trailing off, that leaves Walmart backpedaling to reduce its current inventory and make sure it isn’t over-ordering in case this holiday season is weaker than was initially expected. Walmart is expecting its full-year operating margin to be 3.8% to 3.9% — which is below its 10-year median of 4.6%. If you’re buying just a few shares then you’re likely best off sticking with a market order. Even if you pay a little bit more now for a market order, it won’t affect the long-term performance much, if the stock continues to perform well.

• So at this point, Walmart doesn’t offer as much upside as some of the contending tech and retail stocks, but it does provide a certain level of stability.
• Sales volumes were flat this past quarter while prices jumped 10%.
• Of the 42 analysts issuing opinions on Walmart stock surveyed by S&P Global Market Intelligence, 22 rate it at Strong Buy, 12 say Buy, seven have it at Hold and one calls it a Sell.
• The 52 Week Price Change displays the percentage price change over the most recently completed 52 weeks (260 trading days).

Historical EPS Growth Rate looks at the average annual (trailing 12 months) EPS growth rate over the last 3-5 years of actual earnings. Instead, consider buying these delicate, and often seasonal produce picks, from grocery stores known for fresher produce—or better yet—from local farmers’ markets, where top quality and flavor are a better bet. Walmart is one of the largest and most popular retail giants in the world, difference between hammer and hanging man well known for its wide selection of affordable and practical products. Customers may not even realize the superstore sells food or could have some hesitation about the reliability and quality of its products. Look a bit closer, though, and you’ll see that Walmart has better momentum today. The retailer is benefiting from a healthy balance between rising customer traffic and higher average spending, for example.

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As well, it stocks its shelves with various consumer discretionary products. By not having to drive around from one store to another, households over time can take advantage of this convenience. Walmart Inc. is the world’s biggest company by revenue and its largest employer with over 2.2 million globally. It is a general merchandise discount retailer founded in 1962 by Sam Walton and remains a very tightly-held family-owned company to this day. At last look, the Walton family and its heirs owned more than 50% of the company through the family-holding company Walton Enterprises and individual holdings.

As for WMT stock’s prospects, Wall Street is pretty bullish on the name at current levels. Of the 42 analysts issuing opinions on Walmart stock surveyed by S&P Global Market Intelligence, 22 rate it at Strong Buy, 12 say https://1investing.in/ Buy, seven have it at Hold and one calls it a Sell. That works out to a consensus recommendation of Buy, with high conviction. Walmart is also indisputably one of the best dividend stocks for dependable dividend growth.

This came about as Walmart’s gross profit margin contracted by -0.4 percentage points YoY from 25.0% in Q3 FY 2021 to 24.6% in Q3 FY 2022. Last week, Best Buy reported strong fourth-quarter earnings and revenues, in line with market expectations. If a company’s net margin is 15%, for example, that means its net income (or profit) is 15 cents for every $1 of sales the company makes. A change in margin can reflect either a change in business conditions, or a company’s cost controls, or both.

Walmart Stock (NYSE:WMT): Take the Safe Road

So, these costs are expected to pressure the company’s bottom line in the upcoming Q3, as well. Walmart’s first-quarter revenue rose 7.6% year over year — an acceleration from the 7.3% growth in the fourth quarter of 2022. Same-store-sales growth rates  “were strong globally,” said Walmart CEO Doug McMillon in the company’s first-quarter earnings release. Notably, one key to Walmart’s growth was a 26% year-over-year increase in e-commerce sales. Some investors seek out stocks with the best percentage price change over the last 52 weeks, expecting that momentum to continue. Others look for those that have lagged the market, believing those are the ones ripe for the biggest increases to come.

Walmart issued an update on its third quarter 2024 earnings guidance on Thursday, August, 17th. The company provided EPS guidance of $1.45-$1.50 for the period, compared to the consensus earnings per share estimate of $1.50. The company issued revenue guidance of $157.40 billion-$157.40 billion, compared to the consensus revenue estimate of $157.25 billion. Trefis estimates Walmart’s Q revenues to be around $136 Bil, almost in line with the consensus estimate of $135.5 Bil.