Key Stats for Walmart Stock
- Price change for Walmart stock in the last 6 months: -17%
- $WMT Stock Price as of Aug. 20: $104
- 52-Week High: $135
- $WMT Stock Price Target: $138
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What Happened?
Walmart (WMT) stock dropped about 9% on Thursday, even though the company technically beat Wall Street’s numbers.
Revenue came in at $187.94 billion, slightly ahead of the $186.77 billion analysts expected, and adjusted earnings per share of $0.81 topped the $0.74 forecast.
But the real story investors focused on was U.S. comparable sales, which grew just 2.6%, well short of the 3.5% Wall Street wanted.
Part of that miss came from Walmart’s health and wellness business, which saw a 0.8% headwind after price caps on certain drugs took effect.
- Net income for the quarter came in at $6.37 billion, or 80 cents per share, down from $7.03 billion, or 88 cents per share, a year ago.
- Total revenue did climb, though, up from $177.40 billion in the prior-year period, helped by U.S. net sales of $125.2 billion and international sales of $35.2 billion.
CFO John David Rainey said the company still feels good about the underlying business, but the softer comp number clearly spooked investors used to stronger growth in recent quarters.
Walmart actually raised its full-year outlook, now expecting net sales growth of 4% to 5%, up from a prior range of 3.5% to 4.5%. Adjusted earnings guidance also moved higher, to a range of $2.80 to $2.87 per share.
For Q3 specifically, the company guided for sales growth of 3% to 3.75% and EPS between $0.62 and $0.64, numbers that some investors saw as underwhelming given the size of the recent beat.
Rainey pointed to a few headwinds weighing on results, including more than $2 billion in extra costs this year from higher fuel prices.
He said Walmart is using roughly $2.9 billion in tariff refunds to lower prices for shoppers, particularly in categories like beef, with the full impact expected to show up in Q3.
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What the Market Is Telling Us About Walmart Stock
The sharp drop in Walmart stock shows investors are growing more sensitive to any sign of slowing momentum, even when the company still delivers a headline beat.
A comp sales miss of nearly a full percentage point against expectations was enough to overshadow otherwise solid results, including 17% growth in membership fee revenue and 38% growth in global advertising.
Walmart stock had been on a strong run, fueled by gains in delivery, its marketplace, and higher-income shoppers.
Thursday’s selloff suggests the market had priced in near-perfect execution, and anything short of that, especially on the closely watched U.S. comp number, was enough to trigger a steep pullback.
Rainey noted that consumers remain resilient despite pressure from gas and food costs, but for now, Walmart stock is paying the price for guidance that didn’t fully match elevated expectations.
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
