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Walmart Inc. (WMT - Free Report) is likely to register top-line growth when it reports fourth-quarter fiscal 2024 earnings on Feb 20. The Zacks Consensus Estimate for revenues is pegged at $170.4 billion, suggesting growth of 3.9% from the prior-year quarter’s reported figure.

The consensus mark for quarterly earnings has remained unchanged in the past 30 days at $1.63 per share, which indicates a decrease of 4.7% from the year-ago quarter’s reported figure. WMT has a trailing four-quarter earnings surprise of 8.2%, on average.
 

Factors to Consider

Walmart has been benefiting from its highly diversified business, with contributions spanning various segments, markets, channels and formats. The company has been seeing an increase in both in-store and digital channel traffic, reflecting its adept navigation of the evolving retail landscape.

The company's commitment to innovation and adaptability, particularly in the e-commerce space, has been a major driver. To this end, WMT has bolstered its delivery capabilities significantly. Walmart had nearly 4,600 pickup locations and more than 4,200 same-day delivery stores as of the end of the third quarter of fiscal 2024. Gains from higher-margin ventures, such as advertising, are also noteworthy.

Together, these upsides reinforce the company’s position as a retail powerhouse, which bodes well for the quarter under review.
 

Walmart Inc. Price, Consensus and EPS Surprise

Walmart Inc. price-consensus-eps-surprise-chart | Walmart Inc. Quote

However, Walmart has been navigating a dynamic retail landscape due to challenges like inflation and volatile consumer spending. Customers have been displaying discretion in their spending patterns, choosing more affordable options to manage within their budget. An uneven sales pattern keeps management cautious about customers’ spending patterns.

The company expects sales growth to moderate in the fourth quarter compared with the preceding quarters. The Zacks Consensus Estimate for fourth-quarter sales for the Walmart U.S. segment is currently pegged at $116.9 billion, suggesting a 2.8% increase from $113.7 billion reported in the year-ago period.

The adverse mix has also been a hurdle. In the third quarter of fiscal 2024, Walmart continued to bear category mix-related hurdles stemming from greater rates of grocery and health & wellness compared with general merchandise. Management expects the merchandise mix pressure to have persisted in the fourth quarter and be more pronounced due to the volatile consumer landscape.
 

What the Zacks Model Unveils

Our proven model predicts an earnings beat for Walmart this time. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is the case here.

Walmart has an Earnings ESP of +1.70%, and it carries a Zacks Rank #3. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

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