Walmart's Q2 2024 Earnings Report Exceeds Expectations, Analyst Predicts Quick Stock Rebound

Citigroup's Paul Lejuez raised their price target on Walmart (NYSE: WMT) by 3.4% from $174 to $180 on 2023/08/21. The analyst maintained their Strong Buy rating on the stock.

According to Lejuez, Walmart's second-quarter 2024 earnings report showcased strong results across all segments. The analyst found management's guidance for fiscal year 2023 to be encouraging. Lejuez assured investors that the post-earnings pullback was not indicative of any concerns about Walmart's fundamentals. Instead, it was seen as a strategic positioning ahead of the third quarter.

Lejuez stated, "Citigroup expects the stock to jump back up fairly quickly." This sentiment aligns with the consensus among top-rated analysts, with 84.2% rating Walmart as a Strong Buy or Buy. Only 15.8% consider it a Hold, while no analysts recommend selling the stock.

Walmart's Q2 2024 report exceeded expectations, with earnings per share (EPS) of $1.84. This beat the Zacks Consensus Estimate of $1.69 and showed a 4% increase compared to Q2 2023's EPS of $1.77. The company's revenue for the quarter came in at $161.6 billion, surpassing the Zacks Consensus Estimate of $159.8 billion and Q2 2023's revenue of $152.9 billion by 5.7%.

Looking ahead, Walmart's management provided guidance for Q3 2024 and fiscal year 2024. For the third quarter, the company expects revenue growth of 3% on a constant currency basis. The projected EPS for Q3 is between $1.45 and $1.50. For the full fiscal year, Walmart anticipates revenue growth of 4% to 4.5% on a constant currency basis, up from the previous guidance of 3.5%. The company also raised its EPS guidance to $6.36 to $6.46, compared to the prior range of $6.10 to $6.20.

President and CEO Doug McMillon expressed confidence in Walmart's position for the remainder of the year. He highlighted the global increase in eCommerce, which saw a 24% growth, as well as the strength in food and general merchandise sales. McMillon also stated that the company is well-positioned with inventory for the back half of the year.

Since the release of Walmart's latest quarterly report on August 17, 2023, the stock price has risen by 1.4%. Year-over-year, the stock is up by 13.6%. During the same period, Walmart has outperformed the S&P 500, which has seen a 2.7% increase.

Citigroup analyst Paul Lejuez, who raised the price target on Walmart, is highly regarded in the industry. WallStreetZen ranks Lejuez in the top 4% out of 4,300 Wall Street analysts. With an average return of 10% and a 61.5% win rate, Lejuez specializes in the Consumer Cyclical and Consumer Defensive sectors, among others.

Walmart Incorporated operates various retail, wholesale, and online entities across the United States and internationally. The company's three main segments are Walmart U.S., Walmart International, and Sam's Club. Walmart operates a wide range of store formats, including supercenters, supermarkets, hypermarkets, warehouse clubs, discount stores, and eCommerce websites. The company was founded in 1945 and is headquartered in Bentonville, Arkansas.

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