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Walmart (WMT) Gains But Lags Market: What You Should Know

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In the latest trading session, Walmart (WMT - Free Report) closed at $104.32, marking a +0.96% move from the previous day. This change lagged the S&P 500's 2.12% gain on the day. Elsewhere, the Dow gained 2.13%, while the tech-heavy Nasdaq added 2.64%.

Coming into today, shares of the world's largest retailer had gained 6.44% in the past month. In that same time, the Retail-Wholesale sector lost 2.5%, while the S&P 500 lost 4.4%.

Investors will be hoping for strength from WMT as it approaches its next earnings release, which is expected to be November 15, 2018. The company is expected to report EPS of $1.02, up 2% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $124.83 billion, up 1.34% from the prior-year quarter.

For the full year, our Zacks Consensus Estimates are projecting earnings of $4.79 per share and revenue of $515.06 billion, which would represent changes of +8.37% and +2.94%, respectively, from the prior year.

Investors might also notice recent changes to analyst estimates for WMT. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.8% lower within the past month. WMT is currently sporting a Zacks Rank of #3 (Hold).

Valuation is also important, so investors should note that WMT has a Forward P/E ratio of 21.57 right now. This valuation marks a premium compared to its industry's average Forward P/E of 17.42.

Meanwhile, WMT's PEG ratio is currently 4.25. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Retail - Supermarkets industry currently had an average PEG ratio of 2.26 as of yesterday's close.

The Retail - Supermarkets industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 176, putting it in the bottom 32% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow WMT in the coming trading sessions, be sure to utilize Zacks.com.




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