WMT

You may think that I am trying to shut my eyes to the most recent corporate earnings reports in May, but yes, it was a conscious decision, and that's exactly the way it is. The reason is clear, and it lies in a simple fact that tectonic shifts in so many tech giants' quotes, and also in the broader market as a whole, still look more attractive, giving higher gains at the moment and promising even more fruits in the longer run. However, I can't resist mentioning at least one company in the retail segment that I have a special feeling about. It just reported yesterday afternoon, and I think you can guess that it's another favorite of mine and the market's darling, Walmart.

This time, an oddly specific detail was that Walmart shares initially slid nearly 4% as a very first response to quarterly numbers. But suddenly discounted prices of around $92 per share of the largest and famous U.S. discount retailer were very quickly bought up and recovered to their previous levels above $96 by late Thursday. In my eyes, this sends an even stronger buy&hold signal than if the reaction to quarterly news had been dull and close to neutral. Walmart's earnings this week became another stress test that was successfully passed. In addition to the aggressive buying, Walmart price has confirmed the strength of the support area around $96 for the third time since late February.

As to particular profit numbers, the store chain's EPS (earnings per share) for the first three months of the year came out at $0.61 vs analyst consensus of $0.58. On its top line, Walmart announced sales of $165.6 billion, which brought +2.5% YoY, and was only marginally lower than $166 billion in analyst pool's projections. The last figure could have been the only nominal reason behind a one-off decline in WMT's market prices, which, however, did not last long. Meanwhile, U.S. comparable sales, excluding gasoline, added 4.8% in the quarter vs average projections of 4.1%, with its operating income rising 4.3% to $7.1 billion. Loyalty program's sales rose 2.9% to $22.1 billion, creating growing value for the long-term.

Walmart's CFO John David Rainey noted in an interview with CNBC that consumers will likely start to see higher prices "towards the tail end" of May and "then certainly much more in June" as even reduced import tariffs are going to lift prices anyway, but reiterated its 2026 fiscal year outlook for adjusted per-share income above $2.50 on net sales growth of 3% to 4%. This, I think, was the major market driver to support the optimistic view of the stock's further dynamics.

Walmart is widely appreciated for its low prices and massive selections, and it continues to make its mark and hold the lead among householders. Even if the U.S. or global consumer confidence may decline overall, the sad sentiment will be a win game for sellers of cheaper food and everyday items. If so, repeating all-time highs around $105 (like it was in Feb 25) is just a minimum program for Walmart, although this would represent almost a 10% increase on current prices. Isn't it a charming bet? Only AI behemoths can give more, perhaps. However, Walmart is an AI-based company among retailers, as it has been regularly using AI features over the past few years in order to promote better online sales and improve its off-line service. This brought the expected result very soon and Walmart's e-commerce sales soared another 22% YoY, led by store-fulfilled pickup & delivery.