Investors 'Check Out' of Wal-mart (WMT) Amid Q3 Earnings Beat; Guidance Fails to Lift Spirits

November 15, 2012 8:38 AM EST
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Price: $67.18 -0.65%

Revenue Growth %: +0.7%

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Debt: 528M

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Wal-mart (NYSE: WMT) shares are on the mend Thursday morning following stronger-than-expected third-quarter 2012 results, but tepid outlook for fourth-quarter and 2012 earnings.

Net sales rose 3.4 percent to $113.2 billion, from $109.52 billion in the same period last year. Excluding currency impact, revs were $114.87 billion. Operating income popped 8.7 percent higher to $3.635 billion or $1.08 per share.

Overall, the Street was looking for revs of $113.9 billion and EPS of $1.07.

In the quarter, Wal-mart U.S. comps rose 1.5 percent, Sam's Club rose 2.7 percent, and total U.S. comps were up 1.7 percent. In the same period last year, total U.S. comps rose 1.9 percent. For the 4-5-4 period from Oct. 27, 2012 through Jan. 25, 2013, Wal-mart U.S. expects comp store sales to range from 1.0 percent to 3.0 percent. The Wal-mart U.S. 13-week comp for last year’s fourth quarter rose 1.5 percent.

Operating margin moved from 3.0 percent up to about 3.2 percent.

"Price will continue to be a major factor for U.S. customers over the holidays. Our strong price position and broad assortment are clear competitive advantages," commented CEO Mike Duke. "Across all of our markets, we are seeing the same price consciousness as we do in the United States. More customers are part of a growing global middle class, looking for quality, value and a better life, and our EDLP model matters to these customers."

Looking ahead, the company sees full-year 2012 EPS of $4.88 to $4.93, from $4.83 to $4.93 prior and the consensus of $4.94. Fourth-quarter 2012

Shares are down 3.4 percent in early trading.

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