What's In The Cards For Walmart This Earnings Season?

Goldman Sachs analyst Kate McShane reiterated the Buy rating on Walmart Inc. WMT with a price forecast of $101.

The retail behemoth is expected to report its fourth-quarter earnings on February 20th and conduct its investment community meeting on April 8th and 9th.

McShane views the company’s April 2025 investment community meeting as a potential catalyst for stock growth, as it will outline capital investments and long-term business strategies.

Per the analyst, Walmart holds strength to continue driving solid earnings growth into 2025, supported by market share gains given its proposition for value and convenience, while its profitability profile should also improve, noting that operating income outpaced sales in the third quarter.

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The analyst notes that Walmart’s competitive advantage is growing through alternative revenue streams and automation, which hasn’t yet significantly impacted profits but could boost operating income in the next few years.

Walmart’s automation investments have already exceeded productivity targets, improving inventory flow and reducing labor costs, while supporting everyday low prices for customers, McShane adds.

The analyst raises the fourth quarter Walmart U.S. same-store sales estimate to +4.9% from +4.7% and the gross margin estimate to 23.8% from 23.7%, resulting in a slight increase in EPS to $0.65 (vs. $0.64 prior). As a result, the FY24/25/26 EPS estimates are raised by about 0.5%, to $2.50, $2.78, and $3.16, respectively.

Price Action: WMT shares are trading higher by 0.06% to $97.35 at last check Wednesday.

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