What to expect from Wal-Mart's quarter

Wall Street wants to see profit and sales rise by about 6% from a year earlier.

By Wall St. Cheat Sheet May 14, 2012 5:11PM

Wal-Mart (WMT) will unveil its fiscal first quarter earnings on Thursday. The company operates Wal-Mart discount stores, neighborhood markets and Sam's Club locations.


Here's what you can expect to see.


Wall Street wants profit: The average analyst estimate is for a profit of $1.04 per share, up 6.1% from a year earlier. Expectations have dropped slightly; the average estimate was $1.06 three months ago. But over the last month, the average estimate has held steady at $1.04. For the full year, analysts are projecting profit to rise by 8% to $4.85 a share.


Past earnings disappointment: The company fell short of estimates last quarter after being in line with forecasts the quarter prior. In the fourth quarter of the last fiscal year, it reported net income of $1.44 per share versus a mean estimate of $1.45. Two quarters ago, it reported profit of 97 cents per share.


Revenue expectations: Analysts predict a rise of 6.1% in revenue from a year earlier to $110.5 billion.


Analyst ratings: Analysts are generally bullish on the stock, with 10 analysts rating it as a "buy," one rating a "sell" and 11 telling investors to hold.


A look back: In the fourth quarter of the last fiscal year, profit fell 14.7% to $5.16 billion ($1.50 a share) from $6.06 billion ($1.68 a share) a year earlier, missing analyst expectations. Revenue rose 5.9% to $123.17 billion from $116.36 billion.


Key stats:

In the last fiscal year, revenue rose 8.1% in the third quarter, 5.4% in the second quarter and 4.3% in the first quarter (from the year-ago periods). The company's net income has fallen in the last two quarters.


Stock price performance: The stock has fallen 3% in the last three months. In early March, however, the stock price saw one of its best stretches of the last year when shares rose for eight straight days, increasing 4.5% over that span. That was a significant improvement from last summer, when shares fell for 10 straight days at the end of July and in early August, dropping 8.1% over that period.


Derek Hoffman is the CEO at Wall St. Cheat Sheet. As of this writing, he did not own a position in any of the aforementioned stocks.


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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)
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