Walmart raises guidance, but the stock drops on slower sales growth

Live updates

1. 22d ago

   Walmart stock drops 9% despite earnings beat and raised guidance

   Walmart shares fell 9% on August 20 after the company reported second quarter results. Despite beating earnings estimates and raising its overall guidance, the stock declined as investors reacted to sluggish sales growth. Bank of America responded to the selloff by lowering its price target for the company from $144 to $126, though it maintained a Buy rating. Analysts suggest comments from the CFO indicate that recent wins may lead to a difficult third quarter.

   Why it matters

   The decline follows reports of the slowest US sales growth in six years. Physical stores are not the primary driver of current growth, and lower drug prices have weighed on performance.

   What is confirmed

   • Walmart shares fell 9% on August 20.
   • Walmart beat earnings estimates and raised its guidance.

   Still unconfirmed

   • CFO comments suggest the quarter's biggest win may set up a painful Q3.
   • Bank of America lowered its Walmart price target to $126 from $144 while keeping a Buy rating.

   What to watch next

   • Third quarter earnings reports to verify CFO projections
   • Further price target adjustments from major analysts
   Sources used for this update (5)

   1. 247wallst.com — Walmart Beat Earnings and Raised Guidance. So Why Did the Stock Crash?
   2. financebuzz.com — Bank of America Sends Strong Message to Walmart Investors
   3. www.briefs.co — York Space Systems Stock Plunges 73% After Earnings, Analysts Trim Targets
   4. myinvestingnews.com — Nvidia’s $91 Billion Revenue Test: What Could Send the Stock Sharply Lower
   5. www.fool.com — Walmart Has Gone Down While Target Is Up 62%. But Only 1 of These Dividend Kings Is a Buy in August.
   confidence 90%
2. 26d ago

   Walmart Stock Falls Despite Higher Guidance Due to Slow Sales Growth

   Walmart shares declined following a report of sluggish sales and the slowest US growth in six years. While the company raised its earnings forecast and overall guidance, the stock price dropped as investors reacted to slower sales growth. The company is seeing growth, though physical stores are not the primary driver of that increase. Additionally, declines in drug prices have negatively impacted the company's performance.

   Why it matters

   Walmart is a primary indicator of US consumer spending habits. The tension between raised financial guidance and slowing sales growth highlights a shift in how the retailer is generating revenue.

   What is confirmed

   • Walmart raised its guidance and earnings forecast.
   • Walmart stock prices dropped following the report of slower sales growth.

   Still unconfirmed

   • Physical stores are not the engine of Walmart's sales growth.

   What to watch next

   • Detailed second-quarter earnings report data
   • Analysis of drug price impact on long-term margins
   • Updates on non-store revenue drivers
   Sources used for this update (5)

   1. CNBC — Walmart will report second-quarter earnings before the bell. Here's what to expect
   2. Yahoo Finance — Walmart raises guidance, but the stock drops on slower sales growth
   3. WSJ — Walmart Sales Are Growing, but Stores Aren’t the Engine
   4. Axios — Walmart raises earnings forecast, but drug price declines hit hard
   5. Bloomberg.com — Walmart Posts Sluggish Sales With Slowest US Growth in Six Years
   confidence 80%