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Walmart Earnings, Guidance Blow Away Expectations Amid Shopping Frenzy, As Americans Rush To Beat Even Higher Prices

Walmart Earnings, Guidance Blow Away Expectations Amid Shopping Frenzy, As Americans Rush To Beat Even Higher Prices

Unlike many of its retail…

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This article was originally published by Zero Hedge

Walmart Earnings, Guidance Blow Away Expectations Amid Shopping Frenzy, As Americans Rush To Beat Even Higher Prices

Unlike many of its retail peers, this morning Walmart gave an all clear when it signaled that the retail giant was weathering the global supply-chain snarls and rising inflation successfully, when it not only beat Wall Street’s expectations – despite its margins suffering a hit in the third quarter – but lifted its annual sales outlook and profit forecast again in anticipation of soaring demand during the crucial holiday season.

First, here’s what the company reported for the just concluded third quarter:

  • Adjusted EPS $1.45, estimate $1.40 (range $1.33 to $1.51)
  • Revenue $140.53 billion, +4.3% y/y, estimate $135.69 billion (range $130.66 billion to $140.52 billion)

The big revenue beat was driven by a surge in Q3 comparable sales which soared 9.2% at Walmart’s U.S. stores after excluding fuel, well above the 7% average estimate:

  • Walmart-only U.S. stores comparable sales ex-gas +9.2%, estimate +7.03%
  • Sam’s Club U.S. comparable sales ex-gas +13.9%, estimate +7.75%
  • Total U.S. comparable sales ex-gas +9.9%, estimate +6.99%

Remarkably unlike previous quarters when the comp store beat was driven by tickets at the expense of traffic, in Q3 customers both bought more items and paid more for the goods. Transactions rose 5.7% and average ticket climbed 3.3%, reflecting inflationary trends that are sweeping the consumer sector. here is the full breakdown:

  • Walmart-only U.S. comparable transactions +5.7%, estimate +7.75%
  • Walmart-only U.S. comparable ticket +3.3%, estimate 0%

And visually:

Additionally, the company’s E-Commerce sales continued to grow at an impressive pace, rising +8%, above the average estimate of +1.93%, while Sam’s Club e-commerce sales soared 32%.

While many other retailers including Amazon.com have been struggling to bring products into the United States ahead of the peak shopping season due to shipping logjams, shuttered factories in parts of Asia and a scarcity of raw materials in the recent months, Walmart has been chartering its own vessels to move goods, as a result it said that U.S. inventory was up 11.5% ahead of the busy festive season.

“We have the people, the products, and the prices to deliver a great holiday season for our customers and members,” Chief Executive Officer Doug McMillon said in a statement.

“After two quarters of reasonable but somewhat staid growth, Walmart has posted a very healthy uptick in sales,” Neil Saunders, managing director of GlobalData, said in a note. He said the retailer is poised to benefit from inflation, since it’s known for an everyday-low-price strategy:As prices rise, more Americans turn to Walmart to help them save money.”

Looking ahead, comparable sales in Walmart’s U.S. stores will grow more than 6% this year after excluding fuel, the company said, up from its prior forecast of as low as 5%. Walmart also raised its earnings guidance beat the average analyst estimate; it now expects adjusted profit is expected to be around $6.40 per share up from a previous range of $6.20 to $6.35.

  • Sees adjusted EPS $6.40, saw $6.20 to $6.35, estimate $6.39 (range $6.02 to $6.77) (Bloomberg Consensus)
  • Sees Walmart-only U.S. stores comparable sales ex-gas above +6%, estimate +5.86%

The bold forecast from Walmart come in contrast to rival ecommerce giant Amazon, which issued an underwhelming fourth-quarter outlook and warned of higher costs during the holiday period to weigh on a surge in demand for online shopping.

“Our omnichannel focus is pushing digital penetration to record levels,” President and CEO Doug McMillon said.

To be sure, there were some blemishes: the company said its consolidated gross profit rate decreased 42 basis points, primarily due to increased supply chain costs, a higher mix of lower margin fuel business in the U.S. and a shifting international format mix

The shares initially popped sharply higher in premarket trading following the stronger than expected newst (Walmart has risen just 1.9% this year through Monday, the worst in an S&P index of food and staples retailers, which has gained 18%. Target Corp., which reports results Wednesday, surged 50% during the same period). However, the stock has since drifted and has dropped to pre-market lows.

Tyler Durden
Tue, 11/16/2021 – 09:15

Author: Tyler Durden

Economics

Hillary: “Americans Just Don’t Appreciate What Joe Has Done For Them”

Hillary: "Americans Just Don’t Appreciate What Joe Has Done For Them"

Via 21stCenturyWire.com,

This might be the longest-ever Thanksgiving…

Hillary: “Americans Just Don’t Appreciate What Joe Has Done For Them”

Via 21stCenturyWire.com,

This might be the longest-ever Thanksgiving weekend for Joe Biden. While he’s been enjoying a warm blanket and a hot cup of Ovaltine with his family in Nantucket, the President’s poll numbers have been in virtual free-fall. It seems that the nation is fast losing confidence in his ability to handle important issues like the economy, the border, foreign policy and crime running wild on America’s streets. In short, the majority of Americans, both Democrat and Republican, do not believe Joe is capable of fulfilling his duties as the chief executive of the world’s premier superpower.

At present, Biden’s average job approval rating stands at around 40%, a steep drop from the 55% percent average approval rating he enjoyed last May.

No one really knows just how low Joe will go.

Still, this hasn’t stopped his ardent allies from rushing to his defense, and blaming his flagging numbers on social media trolls (see deplorables).

Carlos Garcia from The Blaze writes…

Former presidential candidate Hillary Clinton tried to explain away President Joe Biden’s poor polling by accusing Americans of not appreciating what Biden has done for them, and blamed social media.

Clinton made the comments while a guest on Rachel Maddow’s MSNBC show Tuesday evening.

“You know, democracy is messy. You know, a lot of people got, oh I think, kind of frustrated looking at the messy process of legislation,” said Clinton.

“And they didn’t really appreciate that, within a year, the Biden administration has passed two major pieces of legislation through both the House and the Senate, they passed another major piece through the House that will be soon be in the Senate,” she continued.

“By any measure those are extraordinary accomplishments and they really will help many millions of Americans with healthcare and prescription drug prices, as well as climate change and so much else,” said Clinton.

“But because of the way we are getting our information today,” she concluded, “and because of the lack of gatekeepers and people who have a historic perspective who can help us understand what we are seeing, there is a real vulnerability in the electorate to the kind of demagoguery and disinformation that, unfortunately, the other side is really good at exploiting.”

Both Maddow and Clinton accused Republicans of undermining the results of fair elections and calling for violence as a political solution in the interview.

Biden’s poll numbers have suffered greatly after a cascade of damaging incidents plaguing his administration. Among the worst were the disastrous retreat from Afghanistan, the painful cost of high inflation, and the crisis of illegal immigration at the border.

One poll from October found that only 38% of Americans thought Biden deserved a positive job rating.

Watch Hillary’s clip here: 

Tyler Durden
Sun, 11/28/2021 – 17:30

Author: Tyler Durden

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Economics

Silver price under pressure despite the risk-off sentiment

Silver price extended the week’s losses in Friday’s session despite the risk-off market sentiment. In the coming week, focus will be on Fed policymakers’…

Silver price extended the week’s losses in Friday’s session despite the risk-off market sentiment. In the coming week, focus will be on Fed policymakers’ remarks and data related to its industrial and precious metal status.

Market mood

The fear & greed index shifted from a greed level of 64 to the fear end of the spectrum. On Friday, the index’s reading was at 31. Both the market volatility and safe-haven demand are exhibiting extreme fear. Usually, risk aversion boosts precious metals based on their safe-haven status.

However, a strengthening US dollar is exerting pressure on silver price. Concerns over the new wave of COVID-19, coupled with positive economic data from the US, boosted the dollar index to its highest level since July 2020. Besides, slowed growth of the Chinese economy has raised concerns over silver’s industrial demand.

In the new week, silver price will be reacting to manufacturing PMI from China and other economies. Besides, investors will be keen on Jerome Powell’s testimony as well as speeches from various Fed policymakers. The speeches come a few days after Fed meeting minutes that exuded a hawkish tone. The nonfarm payrolls data scheduled for Friday will further influence the metal’s price movements.

Silver price technical outlook

Silver price has been under pressure over the past week. The week’s losses defined a trend reversal after the precious metal hit a four-month high in the previous week. Since Monday, it has dropped by about 6.89%.

The precious metal ended the week at 23.17; down by 1.83%. On a four-hour chart, it is trading below the 25 and 50-day exponential moving averages. Besides, with an RSI of 26, it is in the overbought territory.

In the coming week, I expect silver price to remain under pressure amid the strengthening US dollar. However, it may begin the week on a corrective rebound as it finds support along the psychological level of 23.00.

It may bounce back to find resistance along the 25-day EMA at 23.72. Subsequently, it may trade within the formed horizontal channel with 23.16 and 23.72 as the lower and upper borders respectively. Above the aforementioned resistance level, the bulls will be eyeing the 50-day EMA at 24.03. On the flip side, a move below Friday’s low of 22.94 will likely place the support zone at 22.35.

silver price
silver price

The post Silver price under pressure despite the risk-off sentiment appeared first on Invezz.





Author: Faith Maina

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Economics

New Zealand cash rates – the canary in the coal mine?

My son, Angus, ventured into the Sydney residential market at the beginning of the year acquiring a small apartment, with what I considered to be an enormous…

My son, Angus, ventured into the Sydney residential market at the beginning of the year acquiring a small apartment, with what I considered to be an enormous loan from one of the Big Four. At the time the fixed four-year home loan rate was around 1.95 per cent per annum. Today, the advertised rate has jumped 1.0 per cent per annum to around 2.95 per cent. This reflects the Australian four-year Government Bond yield moving up from 0.20 per cent at the beginning of 2021 to the current 1.32 per cent.

The likely response to this change from property buyers today is that a much higher proportion of their mortgage will be attributed to a variable home loan. This rate typically reflects the Reserve Bank of Australia’s (RBA) cash rate, and at 0.10 per cent per annum it is currently at a record low, and well below the “emergency low” of 3.0 per cent per annum implemented during the Global Financial Crisis (6 months to September 2009).

Across the ditch, the Reserve Bank of New Zealand (RBNZ) has raised its official cash rate for the second time in two months by 0.25 per cent to 0.75 per cent per annum to counter growing inflation, which hit 4.9 per cent in the September 2021 quarter, and is expected increase to 5.7 percent in the March 2022 quarter.

RBA vs RBNZ cash rate

Markets are currently pricing in five more 0.25 per cent increases by the RBNZ over the next twelve months to a targeted 2.0 per cent per annum. Will New Zealand be seen as a canary of the coal mine moment given inflation has become a global problem? Only time will tell, however if cash rates happen to jump by 1.5 per cent and this filters through into the rate for variable home loans. The tailwinds currently being enjoyed by asset owners (with debt) – close to nil interest rates – could easily become headwinds.

The US inflation figure for October 2021 hit 6.2 per cent, a 30 year high.  Selected CPI subcategories saw the following 12 month changes: Beef +24 per cent, gasoline +51 per cent, natural gas +28 per cent and used cars and trucks +26 per cent. The UK was not far behind, with an inflation rate of 4.2 per cent for October.

ds-us-inflation-2021-2

Global supply chain bottlenecks and shifting consumer demand from services to goods could well be transitory, but as the Founder of Bridgewater Associates, Ray Dalio, warns, “raging inflation” is eroding people’s wealth today – particularly those who have their money in cash.




Author: David Buckland

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