Walmart's Q1: What To Like And Why Tariffs Aren't A Concern

Retail giant Walmart Inc WMT reported first-quarter results that should make investors happy.

Validation Of Strategy

Walmart's performance in the first quarter validates management's pledge three years ago to make large investments in the business to generate a "good pay-off," Charlie O'Shea, a Walmart analyst at Moody's said during a CNBC interview. Walmart is now performing "better than good," as evidenced by the 3.4 percent U.S. comp growth and 37 percent e-commerce growth.

One of the often overlooked metrics in Walmart's performance is its ability to better target consumers on the higher-end of the income scale, he said.

Overblown Tariff Concerns

Walmart's reputation of "every-day low prices" is unlikely to change in the face of tariffs on Chinese imports, CNBC's Jim Cramer said Thursday morning. The sentiment is reflected in Walmart's stock, which was higher by more than 3 percent Thursday morning. Cramer said Walmart consumers are unlikely to even notice an increase in price and management felt compelled to "say something about it" during the earnings release.

Investors overly focused on tariffs will miss out on Walmart's bigger picture, Cramer said, which include consumers are visiting stores "more than ever" and the e-commerce business is "on fire."

"If they keep at this pace, holy cow, no one can keep up with them other than Amazon," Cramer said.

Walmart's stock traded around $101.11 per share at time of publication.

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Photo courtesy of Walmart.