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Walmart (WMT) Stock Drops Despite Market Gains: Important Facts to Note

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Walmart (WMT - Free Report) closed the latest trading day at $70.38, indicating a -0.52% change from the previous session's end. The stock fell short of the S&P 500, which registered a gain of 1.08% for the day. Elsewhere, the Dow gained 0.32%, while the tech-heavy Nasdaq added 1.58%.

Shares of the world's largest retailer witnessed a gain of 4.18% over the previous month, beating the performance of the Retail-Wholesale sector with its loss of 0.31% and the S&P 500's gain of 0.43%.

The investment community will be closely monitoring the performance of Walmart in its forthcoming earnings report. The company is scheduled to release its earnings on August 15, 2024. On that day, Walmart is projected to report earnings of $0.65 per share, which would represent year-over-year growth of 6.56%. Meanwhile, our latest consensus estimate is calling for revenue of $168.4 billion, up 4.19% from the prior-year quarter.

WMT's full-year Zacks Consensus Estimates are calling for earnings of $2.43 per share and revenue of $675.88 billion. These results would represent year-over-year changes of +9.46% and +4.28%, respectively.

Investors might also notice recent changes to analyst estimates for Walmart. Recent revisions tend to reflect the latest near-term business trends. Consequently, upward revisions in estimates express analysts' positivity towards the company's business operations and its ability to generate profits.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational rating system.

The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has shifted 0.01% upward. Right now, Walmart possesses a Zacks Rank of #2 (Buy).

In terms of valuation, Walmart is presently being traded at a Forward P/E ratio of 29.17. This expresses a premium compared to the average Forward P/E of 13.22 of its industry.

Meanwhile, WMT's PEG ratio is currently 4.08. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Retail - Supermarkets was holding an average PEG ratio of 1.86 at yesterday's closing price.

The Retail - Supermarkets industry is part of the Retail-Wholesale sector. With its current Zacks Industry Rank of 31, this industry ranks in the top 13% of all industries, numbering over 250.

The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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