Wal-Mart Stores Inc. (NYSE:WMT) Posts Good U.S Sales After a Long Time
Wal-Mart Stores Inc. (NYSE:WMT), the retail giant, posted its third quarter earnings before the market instigated on Thursday. It came as a relief to Wal-Mart Stores Inc. (NYSE:WMT) that for the first time in seven months, the sales in US went up. Earnings per share came out to be 1.15 dollars on revenue of 119 billion dollars. A year ago, earnings per share were 1.14 dollars, while the revenue was 118.35 billion.
Same store sales in U.S for the same quarter, shot up by 0.5 percent at Wal-Mart Stores Inc. (NYSE:WMT)’s discount stores. Sam’s Club same stores sales went up by 0.4 percent, and if we include fuel sales, then Sam’s Club sales were up by 0.3 percent. Same sale stores for neighborhood market climbed up by 5.5 percent this quarter, while the overall U.S sales, they shot up by 3.4 percent.
This is the first time in seven quarters that Wal-Mart (NYSE:WMT) has observed a gain in its U.S earnings. The company owes that to inflation obstructed by SNAP-related headwinds. Guidance for the fourth quarter reveals that the company is expected to remain flat or maybe even move up by a single percent, as far as same store sales are concerned. Same store sales at Sam’s Club stores are expected to rise by 2 percent.
For the next quarter, earnings per share are expected to be in between 1.46 to 1.56 dollars. It was 1.60 dollars last year. Wal-Mart (NYSE:WMT) is gearing up for the holiday season, offering five days deals from Thanksgiving via its online web site. Wal-Mart (NYSE:WMT) has already started offering deals on selected items. The company also lowered prices in order to compete with rival Amazon Inc (NASDAQ:AMZN).
The company’s CEO commented on the rise in the U.S sales, stating that the 21 percent rise in the ecommerce sales globally and positive performances in the same store sales at Neighborhood and Sam’s Club stores are signs of a turnaround for the company. For the past 7 quarters, Wal-Mart (NYSE:WMT) has been waiting for this. Now that Wal-Mart (NYSE:WMT) is back to making profits, it can focus upon projects which will propel the company’s position further.
Wal-Mart (NYSE:WMT)’s shares went up by more than 2 percent, standing at 80.89 dollars. The consensus estimate was 78.80 dollars. It might be a little too early to comment upon Wal-Mart (NYSE:WMT)’s growth but it can be certainly suggested that the retailer must capitalize on its growth and keep it steady. Lowering the prices might be a good idea for Wal-Mart (NYSE:WMT), since they are aiming to compete with rival Amazon Inc (NASDAQ:AMZN). But what Wal-Mart (NYSE:WMT) must look to match is Amazon Inc (NASDAQ:AMZN)’s brilliant customer service.
Wal-Mart (NYSE: WMT) may not topple Amazon Inc (NASDAQ:AMZN), but it can certainly narrow the distance. Amazon Inc (NASDAQ:AMZN) has been losing money recently and it’s a great sign for Wal-Mart (NYSE: WMT) to move on to compete head to head with Amazon Inc (NASDAQ:AMZN), since the e-commerce giant is vulnerable now.