After the US retail group opened its books over the past year and presented a billion-dollar loss in the fourth quarter of 2020, Walmart (WMT) shares plummeted.
In addition, the group gave a cautious outlook for the new financial year. The shareholders should be able to look forward to higher dividends and new share buyback plans.
Walmart quarterly figures: good sales – poor prospect
Walmart announced a loss of $ 2.09 billion for the three months ended January last year, compared to earnings of $ 4.14 billion for the same period in 2019. Adjusted earnings per share were $ 1.39 Dollars and was thus far below the estimates of analysts.
Revenue rose from $ 142 billion to a whopping $ 152 billion, beating analysts’ expectations. This is largely due to the flourishing online trade during the corona pandemic. Online sales rose by 69 percent which gives a clear signal as to what should be the focus for this retail giant going forward. Same store sales from Walmart USA increased 8.6 percent. The company estimates the pandemic-related cost was $ 1.1 billion.
The retail giant assumes that in the current fiscal year 2021/22 a similar increase in sales in the US business will remain in the single-digit percentage range. Earnings per share could slide slightly but should remain stable or even increase slightly after adjusting for sales.
The established consensus predicts earnings per share of $5.75 and experts expect earnings to grow by 3 percent. The company increased its quarterly dividend by 1 cent to 55 cents. In addition, the group hopes to repurchase additional securities at a price of $ 20 billion.
What investors think of this news is reflected in the current price.
Walmart stock fails to rebound on Friday
The shares of Walmart crashed during the Thursday some 5.58 percent to $138.98. The stock is currently trading at $139.27, down 5.42 percent. During pre-market session on Friday WMT gained 0.38% but another day in red is expected if bulls fail to defend a $138 level.
So the mood will be bitter, and the sentiment will be fearful. Bull markets climb a wall of worry, they say — and there will be plenty of worry to go around.