Walmart's Q2 Earnings Preview: Can It Regain Momentum?
Walmart's upcoming quarterly release will be closely watched as the retail leader has struggled to regain momentum this year. Despite consistently outperforming its peers over the last five years, Walmart's stock has been down since May's quarterly release, losing -11.6% of its value.
The company is expected to report $0.73 in EPS on $186.3 billion in revenues, representing year-over-year changes of +7.4% and +5.03%, respectively. Estimates have been under pressure, with the current 73-cent estimate down from 74 cents a month ago and 75 cents three months ago.
The retail sector's Q2 earnings season has seen total earnings up +12% from last year on +15.4% higher revenues, with 77.8% beating EPS estimates and 55.6% beating revenue estimates. Amazon's strong results contributed significantly to these numbers, but excluding it, the group's performance is still respectable.
Walmart remains better positioned than its peers due to its value orientation, greater indexing to groceries, and robust digital capabilities. The company has been gaining market share among higher-income households in recent years, offsetting affordability-based demand softness from lower-income consumers.