Wal-Mart Q3 FY2008 Recap
Posted on: November 14, 2008 - Email Article - Printable Version
Wal-Mart [WMT: 56.52, -0.66 (-1.15%)] reported their fiscal year third quarter earnings on Thursday, and the results were somewhat surprising. Wal-Mart reported earnings of $3.14B, or $0.80 a share, for the quarter ending October 31st. For the previous year’s quarter the retailer reported $2.86B, or $0.70 a share. Earnings from continuing for operations were $0.77 a share. This was $0.01 above to the consensus analyst estimates and a penny also above Wal-Mart’s internal estimates. Revenue for the quarter was up roughly 7% to $98.64B.
Looking into the future Wal-Mart slashed their estimates for its full fiscal year earnings from a range of $3.43 to $3.50 to a range of $3.42 to $3.46. This includes a slash of fourth quarter earnings of to a range of $1.03 to $1.07 from an average estimate of $1.12. Many investors expected these cuts going into the earnings call, and some investors were expecting an even larger cut. This was displayed through the 4.39% gain in Wal-Mart’s stock yesterday, but lagged the S&P’s gain of 6.92%.
Obviously the future isn’t as bright as it once was, but that does not mean that all hope is lost. Wal-Mart still stands to have revenues of $112.82B for quarter four in fiscal year 2008 according to an average of 15 analyst estimates. This would be a quarterly year over year sales growth of 5.0%. Wal-Mart has not missed consenus EPS estimates in the last four quarters, and in fact they have beaten estimates by either a penny or two in each of these quarters. Through a deep recession Wal-Mart will be able to lead the competition with their pricing power. Even during the beginning of the recovery after this world economic and financial crisis Wal-Mart should be able to hold in pretty well as consumers are skeptical and will probably continue to spend very frugally for a sustained period of time. Analysts are currently projection a 5.8% year over year sales growth for the retail giant between this current fiscal year and the next. A bleak outlook for the United States or world economy does not necessarily mean a bleak outlook for Wal-Mart and their shareholders.
- Charles W. Petredis
Disclosure: None.
The Following Stocks Were Mentioned In This Article: WMT
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People in America need to realize jus what got America in this shape…”cheap” yes so-call cheap items from a foreign land and now the largest company in America wants to make everything “green” but at the same time they put 95% made in China in their stores in China and support Chinese export…don’t take my word…its on their China web page
quote*Wal-Mart firmly believes in local procurement. We recognize that by purchasing quality products, we can generate more job opportunities, support local manufacturing and boost economic development. Over 95% of the merchandise in our stores in China is sourced locally. We have established partnerships with nearly 20,000 suppliers in China. *end quote!
Now! if there be 182 country’s making items for the world to buy and they have only 5% of the pie in China…duh! This company makes the nice people of China support their currency(yuan) by keeping it in their country working for the people there…. but with the “yuan” going up in value and the US dollar going down…all the foreign items that the American consumer buys thinking it is cheap has went up in price.
People…its all about the currency and to keep a currency strong you got to keep it floating around the country you live in so it can work for you. For the past 12 years all them US dollars are being shipped overseas to a foreign bank and with the American worker not making anything for the foreigner to buy the “we the people” have to turn to the “second” largest employer in America(Uncle Sam) to sell “we the people” debt in order to get all them dollars back!
50 years ago a foreigner would had given their left nut for a US dollar or a Hershey’s chocolate bar and today the same foreigner has got Uncle Sam and the American consumer by both all the while Hershey is moving the chocolate factory to Mexico. Wake up! America and think “MADE IN AMERICA.”
Now…Charles….think about this…
Sam Walton started with Walton’s 5 & 10 and the name wus changed to Wal-Mart with a hyphen in the name but after his death in 1992 tat hyphen wus replaced with a big single STAR……they moved their Purchasing Department to China and now have a Department of People which after all of tat…..Germany and South Korea kicked their @ss out and the nice people of Japan and Mexico have been cutting back on things tat come from tat big block store.
Young people like yourself have no idea what made this country great……it wusn’t cheap crap from a foreign land…. it wus American made.
Have a happy holiday season and support your town!
oh! in June they said tat star will go……maybe you should ask if tat Department of People goes too!
I enjoy your insight madmilker, however in the conservative school of thought, free trade provides large benefits, often outweighing the costs. Globalization is slowly changing in favor of American made goods, as we approach an equilibrium price on labor, where the cost of manufacturing will be equal (or close to it) all over the world. The yuan has been depreciating while the dollar has been appreciating as investors flock to the dollar for safety. Wal Mart does negatively affect the smaller chains but provides greater benefits as a whole.