📌 WHAT HAPPENED

Walmart Inc. (NYSE: WMT) reported Q3 FY2024 earnings well above Wall Street forecasts, with revenue rising 5.2% year-over-year to $160.8 billion, surpassing consensus of $159.3 billion. Adjusted EPS came in at $1.53, exceeding expectations of $1.52. Comparable-store sales in the U.S. rose 4.9%, boosted by strength in grocery and sustained e-commerce growth.

The company also raised full-year guidance, now projecting adjusted EPS of $6.40–$6.48, up from the previous $6.36–$6.46 range. Free cash flow surged to $6.2 billion in the quarter, buoyed by disciplined inventory management, aiding in margin resilience despite cost pressures.

💡 WHY IT MATTERS

Walmart’s performance offers critical insight into evolving consumer behaviour in a high-inflation environment. As shoppers prioritise value and essentials, Walmart, with its scale advantage, continues to take market share—particularly in grocery, which delivered low double-digit growth. Meanwhile, its digital sales grew 24% YoY, underscoring traction in omnichannel execution.

The upbeat quarter also reflects Walmart’s operating leverage, as it manages shrink and logistics rationalisation. Management’s guidance hike suggests confidence in navigating macroeconomic headwinds, especially heading into the crucial holiday period.

📈 INVESTMENT PERSPECTIVE

Walmart’s results reinforce its status as a defensive anchor in portfolios amid uncertainty. The 24% e-commerce growth highlights structural tailwinds, while store footfall remains strong. Its focus on automation, tech-enabled supply chains, and a growing advertising business should support margin expansion over time.

Short term, shares may benefit from positive sentiment ahead of Q4 holiday spend. However, valuation is a watch point—WMT trades at nearly 25x forward earnings, above historical averages. Nonetheless, visibility in earnings and free cash flow make a compelling case for long-term accumulation, particularly given management’s credibility in execution.

🎯 BOTTOM LINE

Walmart is demonstrating both top-line strength and disciplined cost control in a volatile consumer landscape. With increased guidance and strong operating trends, WMT remains a reliable compounder for patient investors, especially in turbulent macro environments.