Walmart reports Q4 results: ‘they’re doing all the right things’

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Shares of Walmart Inc (NYSE: WMT) are up nearly 3.0% on Thursday after the retail giant said its profit and revenue came in ahead of Street estimates in the fiscal fourth quarter.

What the earnings report tells us

Net income registered at $3.56 billion versus the year-ago figure of $2.09 billion.
Adjusted per-share earnings stood at $1.53, as per the earnings press release.

Revenue climbed from last year’s $152.08 billion to $152.87 billion.
FactSet consensus was for $1.50 of adjusted EPS on $151.72 billion in revenue.
eCommerce sales were up 1% YoY but 70% versus fiscal 2020 equivalent.
$10.1 billion divestitures resulted in a 22.6% decline in international sales.
U.S. comparable sales jumped 5.6% versus 6.0% expected. Transaction climbed by 3.1%, and average ticket by 2.4%.
U.S. comparable sales are expected to grow by just over 3.0% this year. This compared to analysts at 2.7%.
EPS is likely to see an about 5.0% increase in fiscal 2023 versus experts’ forecast of 4.0%.

Retail industry expert reacts to Walmart’s results

Also on Thursday, Walmart lifted its annual dividend to $2.24 a share – a 2.0% increase. Commenting on the earnings report, retail mogul Jan Kniffen said on CNBC’s “Squawk Box”:

What I really liked is the new businesses that seem to be doing great, like FBW, Connect, and Data Services. Their base business is also very well run today considering the environment. They’re doing all the right things. They’re competing effectively with Amazon. I don’t think it gets much better than this if you’re Walmart.

According to Kniffen, the earnings report has the potential to make way for Walmart to be a $150 stock. He, however, agrees that inflation continues to be a headwind for the retail giant. Kniffen added:

Eventually, the customer will say I can’t keep taking price. If inflation tops out here at about 8.0% and starts down, everything’s fine. But if inflation move on to 11%, or peaks at 9.0% and stay there all year, we have a really big problem in the retail side, because that’s when the customer will say I can’t do this anymore.

Last month, Walmart said it will launch its own virtual currency and a collection of NFTs to position itself as a beneficiary of the metaverse.

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