Walmart
The retail giant posted fourth-quarter revenue of $141.7 billion which was 2% higher than the same quarter the previous year. Total same-store sales in the U.S. rose 1.8% ex-fuel. Walmart posted net income of $4.14 billion in the fourth quarter, compared to $3.69 billion in the same quarter the previous year. This number came in slightly below analyst projections.
Inside the Numbers
In terms of the full year, Walmart's revenue was $524.0 billion which was 1.9% higher than $514.4 billion the previous year. The company reported $14.9 billion in net income for the year compared to $6.7 billion the previous year which was negatively impacted by a one-time charge on the sale of its Walmart Brazil operation.
For next year, Walmart expects sales growth of 3%, same-store sales growth of 2.5% in the U.S., and 3% at other locations including international and Sam's Club. It's also projecting 30% sales growth for its eCommerce division. These figures were lower than what analysts were expecting, and the stock sold off.
Looking ahead, Walmart projects fiscal 2021 net sales growth of about 3% (constant currency), with same-store sales gains of at least 2.5% (excluding fuel) at Walmart U.S. and about 3% (excluding fuel and tobacco) at Sam's Club. The company forecasts 30% sales growth for Walmart U.S. eCommerce. Net sales growth for Walmart International is pegged at around 4%.
Muted Stock Market Performance
Walmart's stock has been a laggard in 2020. So far, this is the market environment where a speculative stock with no assets or earnings and a compelling story is loved, while a stock with stable cash flows, valuable assets, and durable competitive advantage is unloved.
Since September 2019, the stock has basically plateaued and consolidated between $110 and $120. It's currently 7% below its all-time high and pays a 1.85% dividend yield. Another leg lower in interest rates or a rotation from growth stocks to value stocks could trigger the next move higher in the stock.
