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Wal-Mart (WMT) Beats on Q3 Earnings; Lags on Sales

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Wal-Mart Stores, Inc. (WMT - Free Report) is a multinational retailer that runs large department stores and warehouse store chains. The company has more than 11,500 stores in 28 countries.

Of late, Wal-Mart is delivering positive comps at Wal-Mart U.S., after delivering negative comps since the third quarter of fiscal 2013. This is the result of lower fuel prices, which eased consumers’ spending power. However, the company has been facing huge expense burden of late. Huge investments in e-commerce initiatives, higher wages and training costs increased expenses. This along with unfavorable currency is taking a toll on the results. Given these factors, investors were eagerly waiting for the company’s latest earnings report.

This is especially true given the recent earnings estimate revisions for WMT as the consensus estimate has remained unchanged over the past 30 days. Further, WMT has an impressive earnings history. WMT has delivered positive earnings surprise in all the last four quarters, making for an average positive surprise of 6.13%.

Currently, WMT has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here. The Zacks Rank could definitely change following Wal-Mart’s earnings report which was just released. We have highlighted some of the key stats from this just-revealed announcement below:

Earnings: WMT posted earnings of 98 cents per share, beating our consensus of 96 cents per share. Investors should note that these figures take out stock option expenses.

Revenue: WMT posted revenues of $118.2 billion. This marginally lagged our consensus estimate of $118.5 billion.

Key Stats to Note: Wal-Mart U.S. comparable store sales increased 1.2% in the third quarter, driven by 0.7% growth in traffic and 0.5% increase in ticket. Comp sales on the other hand increased 1.4% at the Sam's Club, without the impact of fuel, driven by a 1.9% growth in ticket. The company has raised the lower end of the previously provided adjusted earnings guidance.

Stock Price: Shares of Wal-Mart declined around 1.25% in the pre-market trading.

Check back later for our full write up on this WMT earnings report later!

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