Key points
- Walmart is the largest grocer, importer and employer in the United States, with sales exceeding half a trillion dollars in 2023.
- Walmart began trading with a 3-for-1 split on February 26, 2024.
- Walmart announced it is acquiring smart TV maker Vizio to boost its advertising business through its SmartCast operating system, which has 18 million accounts.
- 5 stocks we like better than Walmart
Walmart Inc. New York Stock Exchange: WMT is a retail giant with over 10,600 stores worldwide in over 27 countries, hosting nearly 255 million customers weekly. Walmart is the world’s largest employer, with 2.1 million workers worldwide. It is the largest consumer discretionary company and the largest employer in the United States, with 1.6 million employees. Walmart is the largest grocery store chain in the United States, followed by Costco Wholesale Co. NASDAQ: COST AND Kroger Co. NYSE: KR. It is also the country’s largest importer and enjoys the benefits of a strong dollar. The stock rose to a high of $180 before a 3-for-1 split occurred on February 26, 2024. Now that the shares are a third of where they were trading before February 26, 2024, now is a good time to get in on the action . Walmart stock?
The giant continues to grow
Despite Walmart’s unprecedented size, sales continue to grow year over year, surpassing half a trillion dollars in 2023. In the fiscal fourth quarter of 2024, Walmart generated earnings per share of $1.80 versus $1.64 , a 10% beat. Revenue increased 5.7% year over year to $173.4 billion from $170.85 billion. Consolidated gross margin is expected to increase 39 basis points as Walmart’s global e-commerce sales in the U.S. increased 23% year-over-year. U.S. non-fuel comps rose 3.9%. Its annual cash dividend was increased 9% to 83 cents per share after the stock split or $2.49 per share before the split.
Raise the bar
Walmart expects fiscal first-quarter 2025 EPS of $1.46 to $1.56 versus consensus analyst estimates of $1.60. First quarter 2024 revenues are expected to grow 4% to 5% year over year, reaching $158-160 billion from $157.27 billion. Full-year fiscal 2025 EPS is expected to be in the range of $6.70 to $7.12 versus consensus estimates of $7.06. Full-year fiscal 2025 revenues are expected to grow 3% to 4% year over year, rising from $667.6 billion to $674.1 billion from $666.93 billion.
International growth
Walmart noted that higher transaction numbers and unit volume have led to market share gains in the U.S. and internationally. Walmart surpassed more than $100 billion in international sales in 2023. During the 2023 calendar year holiday season, Walmart had two days of record-breaking volume in the lead-up to Christmas. Store delivery sales increased 50% year over year. High-income families helped share earnings through delivery as a source. Sam’s Club member warehouses reported overall sales growth of 3.1%, excluding fuel, with strength in consumables, healthcare and food categories.
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Consumers remain resilient
Despite economic uncertainty, Walmart continues to see resilience in its customers, who find value in apparel and hardlines. Prices are lowest on an annual basis for food products including apples, eggs and snacks, but highest for asparagus and blackberries. Its private label penetration, like Target Co. New York Stock Exchange: TGT, is growing rapidly in many countries. Walmart plans to remodel 928 stores and clubs worldwide by next year, including 650 locations in the United States.
Walmart CEO Doug McMillon said, “Our team delivered a great quarter, capping off a strong year. We surpassed $100 billion in eCommerce sales and have been growing shares as our customer experience metrics customer have improved, even during the highest volume days leading up to the holidays. We are proud of the team and excited to build on our momentum as we work to lower prices for our customers and members.”
Acquisition of VIZIO announced
In an unexpected move, Walmart announced its acquisition of the smart TV maker VIZIO Holding Co. NYSE: VZIO. Walmart will acquire its proprietary SmartCast (O/S) operating system and 18 million active accounts. Walmart will pay $11.50 per share in cash or $2.3 billion in an all-cash deal. This move further collapsed the streaming operating system and smart TV maker Roku Inc. NASDAQ: ROKU. Walmart’s massive distribution channel can breathe new life into Vizio’s sales and help boost Walmart’s high-margin advertising business through its SmartCast operating system, which allows users to stream ad-supported TV content. Walmart’s advertising business grew 33%, including 22% from Walmart Connect in the fiscal fourth quarter of 2024.
Walmart analyst ratings and price targets I’m on MarketBeat. Walmart colleagues and competitor actions can be found with MarketBeat Stock Screener.
Wedge rising daily
The daily candlestick chart for WMT illustrates the ascending wedge pattern. This pattern is typically a reversal pattern as the channel of higher highs and lower lows narrows until the stock triggers a strong pullback. The daily relative strength index (RSI) is starting to break below the overbought 70 range. Pullback support levels are at $58.00, $56.25, $53.29, and $50.52.
Before considering Walmart, you’ll want to hear it out.
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