November 17, 2021 8:00 AM
 — 
3
 min

Black Friday results - a potential short-term driver of capitalization growth

buy

Net income for the fiscal quarter ended October 31 was $ 3.11 billion, or $ 1.11 per share, compared with $ 5.14 billion, or $ 1.80 per share, in the comparable period last year. Adjusted earnings were fixed at $ 1.45 per share, better than the consensus of $ 1.4. Walmart's updated forecast for fiscal 2022 expects adjusted earnings per share to be $ 6.40, up from the previously announced $ 6.20-6.35. Like-for-like sales in the US are projected to grow 6% (up from 5-6% previously). The market estimates the company's 1-year adjusted earnings at $ 6.34 per share.

TIKR:
WMT

PRICE:
$143

TARGET PRICE:
$175

UPSIDE:
22%

S&P 500
4,693(-0.05%)

WTI СRUDE
80.51(-0.73%)

10Y UST
1,6340(0.00%)

BITCOIN
$59,691(-1.34%)

Retaining customers won in the midst of a pandemic can be challenging, but Walmart will be able to maintain its share through the scale of its business and transforming its operations. Walmart's plans to open new stores are much smaller than in previous years, while investments in e-commerce, high technology and store modernization, on the contrary, have increased significantly. The company intends to develop online sales not only in the United States, but also in the international market.

We love Walmart's global reach, ample opportunity for international growth, increased focus on e-commerce and small regional markets, and support for its own capitalization. Walmart has bought back more than $ 5 billion of its own shares since the beginning of this year. We believe that the recovery in economic activity and the growth of consumer confidence in the United States will be the key drivers for the growth of the share price. We forecast positive revenue dynamics to continue in fiscal 2022, so we keep our valuation for the stock at $ 175. The short-term driver for growth in Walmart shares may be the results of pre-holiday sales, which start from Black Friday (November 26) immediately after Thanksgiving (November 25).

Walmart is one of the largest global retailers, with close to $475 billion in annual revenue. The company’s stores offer a variety of merchandise, including grocery, household goods, electronics, health and wellness, hairlines, apparel, and home products. Walmart’s business strategy rests upon its Every Day Low Price (EDLP) philosophy, under which the company assures customers that they are getting the lowest prices. Walmart’s business is segmented into three reporting divisions: Walmart US, Sam’s Club, and Walmart International. Walmart US operates retail stores in the US and Puerto Rico; Sam’s Club operates club warehouses for members to buy items at the lowest prices, and Walmart International encompasses all of the company’s International operations, including Sam’s Club overseas.

Request Access

By clicking the button you agree to the Privacy Policy
Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.
Recent Posts
SEE ALL