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ETFs to Gain Post Solid Walmart Q4 Earnings

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Before the opening bell yesterday, Walmart (WMT - Free Report) reported stronger-than-expected fourth-quarter fiscal 2022 results, outpacing both earnings and revenue estimates. The mega retailer forecast an upbeat full-year outlook.

Following the solid results, WMT shares spiked 4% on the day. The solid trading is expected to fuel a rally in ETFs having the highest allocation to the world's largest brick-and-mortar retailer. Vanguard Consumer Staples ETF (VDC - Free Report) , Fidelity MSCI Consumer Staples Index ETF (FSTA - Free Report) , iShares Evolved U.S. Discretionary Spending ETF (IEDI - Free Report) and VanEck Vectors Retail ETF (RTH - Free Report) will be in focus in the coming days.

Walmart Earnings in Focus

Earnings per share came in at $1.53, surpassing the Zacks Consensus Estimate of $1.50 and improving 4.8% from the year-ago earnings. Revenues rose 0.5% year over year to $152.9 billion and topped the consensus mark of $151.4 billion. U.S. comparable sales jumped 6.3% (see: all Consumer Staples ETFs here).

The world's biggest retailer expects sales to grow around 3% for fiscal 2023, with earnings growth in the 'mid-single-digit' range. U.S. same-store sales are likely to increase more than 3%. Walmart raised its quarterly dividend by a penny to 56 cents per share, marking the 49th consecutive year of dividend increases.

Below we have detailed the ETFs:

Vanguard Consumer Staples ETF (VDC - Free Report)

Vanguard Consumer Staples ETF also targets the broad consumer staples by tracking the MSCI US Investable Market Consumer Staples 25/50 Index. It holds 99 stocks in its basket, with Walmart occupying the fifth position, having 7.2% allocation. Vanguard Consumer Staples ETF is widely spread across household products, soft drinks, packaged foods & meats and hypermarkets & supercenters that make up for a double-digit allocation each.

Vanguard Consumer Staples ETF manages a $6.6 billion asset base and charges a fee of 10 basis points (bps) per year. VDC trades in a good volume of around 191,000 shares per day on average and has a Zacks ETF Rank #3 (Hold) with a Medium risk outlook.

Fidelity MSCI Consumer Staples Index ETF (FSTA - Free Report)

Fidelity MSCI Consumer Staples Index ETF tracks the MSCI USA IMI Consumer Staples Index, holding 105 stocks in its basket. Of these, Walmart takes the fifth spot with 7.2% share in FSTA. Fidelity MSCI Consumer Staples Index ETF is widely diversified across beverages, food and staples retailing, household products and food products with double-digit exposure each.

Fidelity MSCI Consumer Staples Index ETF has amassed $985.6 million in its asset base while trading in a moderate volume of around 151,000 shares a day on average. FSTA charges 8 bps in annual fees from investors and has a Zacks ETF Rank #4 (Sell) with a Medium risk outlook (read: Here's Why You Should Invest in Consumer Staples ETFs).

iShares Evolved U.S. Discretionary Spending ETF (IEDI - Free Report)

iShares Evolved U.S. Discretionary Spending ETF is an actively managed ETF that employs data science techniques to identify companies with exposure to the discretionary spending sector. It follows the Cboe BZX, formerly known as BAT and holds 218 stocks in its basket. Walmart occupies the fourth position with 5.3% share. IEDI is dominated by retailing with half of the portfolio, while consumer services and food & staples retailing round off the next two with double-digit exposure each.

iShares Evolved U.S. Discretionary Spending ETF has accumulated $26.7 million in its asset base and charges 18 bps in fees per year. Volume is paltry for IEDI as it exchanges 3,000 shares a day, on average.

VanEck Vectors Retail ETF (RTH - Free Report)

VanEck Vectors Retail ETF provides exposure to the 25 largest retail firms by tracking the MVIS US Listed Retail 25 Index, which measures the performance of the companies involved in retail distribution, wholesalers, online, direct mail and TV retailers, multi-line retailers, specialty retailers and food and other staples retailers. Walmart takes the fourth spot with 5.4% share (read: Stocks & ETFs to Fall for in the Valentines' Week).

VanEck Vectors Retail ETF has amassed $220.9 million in its asset base and charges 35 bps in annual fees. It trades in a lower volume of 13,000 shares a day on average. VanEck Vectors Retail ETF has a Zacks ETF Rank #3 with a Medium risk outlook.
 

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