Three Retailers Trading At All-Time Highs

Wall Street analysts expect a strong 2020 holiday season despite the pandemic, with e-commerce sales continuing their torrid growth pace. Many brick and mortar retailers should outperform as well because well-constructed online sales portal will add to modest in-store purchases. However, storefronts without a strong internet presence are likely to flounder, with the growing infection rate keeping many customers out of virus-ridden closed ventilation systems.

Let’s look at three hybrid retailers hitting all-time highs as we get closer to the holidays and year’s end. These are big cap companies that have adapted well to the age of the Internet, with an expanding customer base utilizing curbside pick-up and package delivery as well as physical shopping trips. Of course, this is the ‘new normal’, with retailers that waited too long to open or expand online sales, like America’s struggling mall anchors, having a tough time paying the bills.


Dow component Walmart Inc. (WMT) waited until 2016 to get in the e-commerce game, buying for a hefty premium. They’ve now combined that operation into a robust site that’s emerged as the primary competitor to Inc. (AMZN). The company has also launched a membership program to rival Prime, setting the stage for an epoch retail battle. In the meantime, the stock is trading just five points below November’s all-time high while holding onto a 26% year-to-date return.


Target Corp. (TGT) has emerged as 2020’s top retail performer, taking market share from equal-sized and smaller rivals during the first quarter’s pandemic decline. The company blew away Q3 2020 estimates in November, picking up additional market share through strong execution. Same day and drive-up sales exploded during the quarter, growing 200% and 500% year-over-year, respectively. As the company noted, customers have shifted spending from travel into the goods they sell, raising odds for continued strong growth in 2021.


TJX Companies Inc. (TJX) sells home basics, apparel, and home fashions through T.J. Maxx, Marshalls, Homesense, and Sierra stores. This ‘off-price’ operation provides a less robust online sales portal than Walmart or Target and has no curbside pick-up. However, it executes so well that investors keep buying the stock, which is trading less than one point under an all-time high. Even so, this issue will carry greater downside risk through the winter months due to the surging pandemic.

For a look at all of today’s economic events, check out our economic calendar.

Disclosure: the author held no positions in aforementioned securities at the time of publication.

Walmart Earnings Beat Wall Street Estimates; Buy with Target Price $175

Walmart Inc, an American multinational retail corporation that operates a chain of hypermarkets, reported better-than-expected revenue and profit in the third quarter, largely driven by a surge in online sales as buyers purchased everything from the comfort of their homes amid the COVID-19 pandemic.

The world’s largest retailer by revenue said its online sales grew 79% with total revenue increasing 5.2% to $134.71 billion, beating market expectations of $132.23 billion. Walmart sales at U.S. stores open at least a year rose 6.4%, beating Wall Street consensus of 4.16% growth.

Walmart reported adjusted earnings of $1.34 per share, topping analysts’ expectations of $1.18. International net sales were $29.6 billion, an increase of 1.3%.

“We would characterize this as more of a true upside surprise, even though comps were up 9.3% last quarter. Recall that Walmart started the period off slowly due to a late start to back to school. These results suggest that trends may have improved a bit as the quarter went on. Most line items followed a similar pattern. But, overall, we see these results as supportive of our BUY rating even as the stock hit an all-time high yesterday,” said Michael Baker, MD and Senior Research Analyst at D.A. Davidson & Company.

“We believe Walmart takes share in strong environments and also outperforms in tougher economies. The key to the stock today will be comments on trends throughout the quarter as well as early 4Q as the pandemic re-surges,” Baker added.

Despite this optimism, Walmart shares traded nearly flat at $152.30 on Tuesday; the stock is up about 30% so far this year.

Executive Comments

“This was another strong quarter on the top and bottom line. Our associates continue to impress during this challenging year. They are working together to serve customers and communities in new, relevant ways and we’re very proud of them. We think these new customer behaviours will largely persist and we’re well-positioned to serve customers with the value and experience they’re looking for,” Doug McMillon, President and CEO at Walmart.

Walmart Stock Price Forecast

Twenty-six equity analysts forecast the average price in 12 months at $152.19 with a high forecast of $175.00 and a low forecast of $130.00. The average price target represents a 0.07% increase from the last price of $152.09. From those 26 analysts, 21 rated “Buy”, five rated “Hold” and none rated “Sell”, according to Tipranks.

Morgan Stanley gave the base target price of $150 with a high of $240 under a bull-case scenario and $95 under the worst-case scenario. The firm currently has an “Overweight” rating on the multinational retail corporation’s stock. Walmart had its price target raised by Jefferies Financial Group to $170 from $165. Jefferies Financial Group currently has a buy rating on the retailer’s stock.

Several other analysts have also recently commented on the stock. The Goldman Sachs Group reaffirmed a buy rating and set a $144 target price on shares of Walmart. Cowen reissued a buy rating and issued a $155 price objective. Telsey Advisory Group lifted their price objective to $145 from $140 and gave the stock an outperform rating. At last, JP Morgan restated a neutral rating and issued a $137 target price.

As our previous target of $150 has been achieved, we have updated our target to $175 as 50-day Moving Average and 100-200-day MACD Oscillator signals a strong buying opportunity.

Analyst Comments

“We expect Walmart to sustain recent momentum in its core business in F’21/F’22 and see a growing ability to balance longer-term investments with near-term returns. Our OW rating and $150 PT are underpinned by a preference for 1) quality players with scale and 2) defensive retailers in the current COVID-19 environment,” said Simeon Gutman, equity analyst at Morgan Stanley.

Upside and Downside Risks

Risks to Upside: 1) Comps accelerate to +MSD-HSD led by continued Grocery strength. 2) Sustainable US e-comm growth of 50-60%+ behind Click & Collect momentum. 3) PhonePe gains wider market appreciation, driving incremental multiple expansion. 4) Walmart+ gains more traction than expected – highlighted by Morgan Stanley.

Risks to Downside: 1) E-commerce loses begin to rise again after briefly moderating. 2) US e-comm growth slows to <30% (comps <2%). 3) Greater than expected Flipkart losses.

Check out FX Empire’s earnings calendar

Blame it on The Nasdaq

US data announced this week showed a significant recovery in building permits and housing, building permits (MoM) for July surged to 18.8% compared to the previous 3.5%, Housing Starts data revealed 22.6% which is 5.1% higher than the previous month, existing-home sales data were as well positive reported beyond expectations.

Despite the negative Jobless claims and Philadelphia Fed Manufacturing PMI reported on August 20, Manufacturing PMI and Services PMI demonstrated a significant improvement, which led major US Indices to surge whereas S&P500 and Nasdaq100 reached the all-time high.

US stocks continue hitting records, Tesla surged by 24.19% breaking the significant $2000 per share value, and is now worth more than $382 billion surpassing Walmart by nearly $10B. Nasdaq’s top company by market cap – Apple gained 8.23% hitting the $2127B in capitalization. Tesla and Apple remain the top popular shares last week based on Robinhood data.

S&P500 closed above the all-time high, some might think that there is a possible double top pattern, economic recovery of the US indicates that the index may continue the run towards $3500.

Nasdaq owes its gains not only to Tesla and Apple, but there are also other tech companies that surged last week and during the pandemic, such as NVIDIA, AMD, Qualcomm, Microchip Tech, Texas Instruments.

An hourly chart demonstrates that the correction is most likely will happen as the price touched the dynamic resistance and the fifth wave of an ending diagonal is about to complete at 11600. Ending diagonal is a trend reversal pattern, which usually demonstrates exhaustion of bulls, note the evening star doji, though the closing is above the previous close, it still shows uncertainty and exhaustion.

NDX chart by TradingView

How is it related to cryptocurrencies and Bitcoin?

Bitcoin and Ethereum price actions are considered as cryptocurrency market movers. Since Bitcoin is nowadays considered as the digital Gold and Ethereum as a digital Silver, their price action now is correlated to US data which effect Gold. Gold was ever since used as a safe-haven to hedge funds during the uncertain times and inflation, so is Bitcoin now.

An hourly chart of Bitcoin indicates that the price could decline further to towards $11200 – $11160 to complete the Head and Shoulders pattern, another pattern to watch is an ending diagonal which is yet to be completed as well. Bitcoin remains below the major resistance level of $11700 an in order to show another bull run it must break the dynamic resistance (ending diagonals upper edge) and close above the 11700, however testing 11200 might bring another stimulus for bulls.

BTCUSD price on Overbit

Ethereum plummeted to $380 after reaching the year’s maximum at $446.67, loosing 9.7% this week only. Digital Silver price is following a similar ending diagonal pattern, and if the upper dynamic resistance and a static resistance of 397 is not overpassed, ETH might continue the drop towards a major support at $380, and if that support is broken, towards $370 – 369.

ETHUSD price on Overbit

Unlike Bitcoin, Gold lost only 0.20% in price for the week. A significant drop was on Wednesday August 19 ahead of US data announcements, where the precious metal lost 3.67% after gaining 2.97% on Monday and Tuesday.

Head and shoulders pattern is identified on an hourly chart of Gold and the price might continue the drop down to $1881.60 – 1880, where if the support laid on those level withheld the price might retrace towards 2014 and if above towards 2046, where the bearish pattern will be completed.

Gold price on Overbit

Since Gold and Silver prices demonstrate similarities in their price action, the same Head and Shoulders is visible on an hourly chart of XAGUSD. The price is below the dynamic support of August 12 which might signal to a further decline down to $25.30.

Silver price on Overbit

The price continues the short-term downtrend move inside a descending channel, which in other had forms another controversial to the H&S pattern of Bullish Flag.

Silver price on Overbit

If bulls are able to push the price above the dynamic support and if the dynamic resistance is overtaken at $27, the bullish run might proceed towards $28 – 28.50.

Key takeaways for the upcoming week would be announcements from Eurozone, Great Britain, China and the US.

Important announcements to watch:

Tuesday, August 25, 2020

German GDP (YoY) as per Second quarter data is expected to be -11.7%, 9.8% lower than the previous -1.9%

German GDP (QoQ) as per Second quarter data is expected to be -10.1%, 7.9% lower than the previous -2.2

US CB Consumer Confidence (August) is expected to be 93, 0.4 points higher than the previous 92.6

US New Home Sales (July) is expected to be 786K, 10K higher than the previous 776K

Wednesday, August 26, 2020

US Core Durable Orders is expected to be 2.1%, 1.5% lower than the previous 3.6%

Thursday, August 27, 2020

US GDP (QoQ) as per 2nd Quarter is expected to be -32.6%, 0.3% higher than the previous -32.9%

US Initial Jobless Claims is expected to be 1,000K, 106K lower than the previous 1,106K

US Pending Home Sales (MoM) as per July is expected to be 4.5%, 12.1% points higher than the previous 16.6%

Asides from the data to be announced, there are other important events to trace.

Republican National Convention, which will be held on Monday, in which delegates will determine the nominees for the upcoming presidential elections. Markets will be watching this event closely as during the current campaign Democrats are having an edge over republicans.

Source: Yahoo Finance

Another major event would be an annual Jackson Hole conference this Thursday, August 27, where FED Chairman Jerome Powell will speak about current economic situation, inflation targets and possibly share preliminary focus on interest rate change.

The economic state and inflation in the US once again are an important constituent of the Global economy and global markets, all these events will be decisive for the mid-term price movements for the US Indices, commodities and cryptocurrencies.

Will Tesla Stock Price Crash?

Just today, Tesla surpassed Walmart’s market cap – how is that possible? Walmart has 534.66 billion in sales versus just 25.71 billion for Tesla.


The trend in TSLA is overbought. The MACD and the RSI (14) are diverging negatively, suggesting waning momentum. The stock is behaving like a commodity – not a business. I see the potential for a “buy the rumor sell the news” event after the stock splits. I think prices will correct at least 50%, and that is extremely conservative.

A close up of a map Description automatically generated

Another way to measure Tesla’s ludicrous valuation is through total revenue – let me explain. Hypothetically speaking, let’s say a company paid 100% of its annual revenue to shareholders as a dividend. Of course, this is not possible, but it helps make my point. In the example below, we will measure how many calendar days it would take to recover your initial investment if each company paid 100% of their profits to shareholders at today’s stock price.

Time to recover initial investments:

Ford Motor Company (F) $6.66

Revenue 130.4 billion

Revenue Per Share $32.87

Time to recover initial investment 74-days

General Motors (GM) $28.56

Revenue 115.79 billion

Revenue Per Share $80.94

Time to recover initial investment 128-days

Walmart (WMT) $131.65

Revenue 534.66 billion

Revenue Per Share $188.23

Time to recover initial investment 255-days

Tesla (TSLA) $2042.41

Revenue 25.72 billion

Revenue Per Share $141.64

Time to recover initial investment 5263-days or over 14-years.

Lastly, the combined market cap of Ford, GM, and Fiat Chrysler (the big three) is 90-billion, and in 2019 they produced 7,470,370 vehicles. Tesla’s market cap is 300% greater than all three (307 billion), and they delivered only 195,000 vehicles – ASTONISHING.

What goes up – must come down. Will Tesla prices crash soon? Maybe – it is hard to say. Whatever the case, I think we will get a generational buying opportunity in TSLA next year or early 2022.

AG Thorson is a registered CMT and expert in technical analysis. He believes we are in the final stages of a global debt super-cycle. For more information, please visit here.

Walmart Could End Long-Term Uptrend

Dow component Walmart Inc. (WMT) hit an all-time high and sold off earlier this week after posting a better-than-expected Q2 2020 profit of $1.56 per-share on a 2.8% year-over-year rise in revenue to $137.7 billion, also beating estimates. U.S. e-commerce sales grew an impressive 97% while quarterly comps rose 9%. Home improvement, sporting goods, landscape, and electronics all reported strong increases while back-to-school sales have lagged due to pandemic shutdowns.

Walmart Picking Up Market Share After Competitors Close

The retail giant surged to an all-time in March, building first quarter market share while smaller competitors shut their doors in reaction to stay-at-home and quarantine orders around the globe. A robust e-commerce portal also allowed Walmart to compete forcefully with Amazon.Com Inc. (AMZN), while both mega-caps picked up permanent market share. However, 2020 leaders have now fallen out of favor, with large chunks of capital rotating into beaten-down recovery plays.

Telsey Advisory Group raised their target from $140 to $145 on Wednesday, with analyst Joseph Feldman noting “we believe Walmart is well-positioned to gain market share in this volatile market, given its defensive core product mix, renewed focus on discretionary categories, and solid digital/omni-channel initiatives. Furthermore, newer initiatives, such as the expansion of third-party marketplace services, new health clinics, and a potential membership program, should all fuel growth”.

Wall Street And Technical Outlook

Wall Street consensus has deteriorated since the earnings release, with a ‘Moderate Buy’ rating based upon 17 ‘Buy’ and 6 ‘Hold’ recommendations. No analysts are recommending that shareholders sell their positions and move to the sidelines at this time. Price targets currently range from a low of $130 to a street-high $160 while the stock is now trading right on top of the low target. This is dangerous positioning because it could trigger further downgrades.

The stock has been under aggressive selling pressure since February, despite a volatile uptrend that carved four new highs between March and August. This odd conflict establishes a major bearish divergence, warning that smart money has been using higher prices to unload large positions. This is a potent combination that often precedes major tops, telling shareholders to take defensive measures and consider moving to the sidelines.

Walmart Posts Record Surge in Q2 Online Sales; Buy with Target Price $150

Walmart Inc, an American multinational retail corporation that operates a chain of hypermarkets, said its total revenue increased 5.6% in the second quarter to $137.7 billion and posted its biggest growth in online sales as buyers purchased everything from the comfort of their homes amid COVID-19 pandemic.

The world’s largest company by revenue said its U.S. sales increased 9.3%, led by strength in general merchandise and food and U.S. eCommerce sales grew 97% with strong results across all channels. Growth in membership income was the highest quarterly increase in more than five years. New member count increased by more than 60%.

“We like Wal-Mart’s global scale, extensive international growth opportunity, increasing focus on e-commerce and smaller Neighborhood Markets, and the company’s status as a large-cap defensive stock,” said Oliver Chen, equity analyst at Cowen.

“We believe improving US comps and the health of the US consumer are key positives for the stock and believe top-line momentum is set to continue in FY21 & FY22 driven by price investments and an improved store experience. We rate WMT Outperform with a $155 price target on ~28x our FY22 EPS of $5.50E,” Chen added.

The company said its operating income rose 8.5% to $6.1 billion in the quarter, while adjusted earnings per share of $1.56.

However, Walmart said its international net sales were $27.2 billion, a decrease of 6.8% as volatile currency rates negatively affected net sales by approximately $2.4 billion. The company’s net sales and operating results were significantly affected by a continuation of the global health crisis.

Walmart shares closed 0.6% lower at $134.7 on Tuesday, but it is up over 13% so far this year.

Walmart stock forecast

Twenty-two analysts forecast the average price in 12 months at $142.35 with a high forecast of $160.00 and a low forecast of $130.00. The average price target represents a 5.67% increase from the last price of $134.71. From those 22, 16 analysts rated “Buy”, six rated “Hold” and none rated “Sell”, according to Tipranks.

Morgan Stanley target price is $150 with a high of $240 under a bull scenario and $95 under the worst-case scenario. D.A. Davidson raised the price target to $154 from $148 and RBC raised it to $137 from $132.

Other equity analysts also recently updated their stock outlook. Keybanc raised the price target to $150 from $138, Raymond James upped the price objective to $145 from $140, Jefferies increased it to $157 from $151 and Stifel upgraded it to $130 from $125.

We think it is good to buy at the current level and target $150 as 50-day Moving Average and 100-200-day MACD Oscillator signals a strong buying opportunity.

Analyst view

“We expect Walmart to sustain recent momentum in its core business in F’21/F’22 and see a growing ability to balance longer-term investments with near-term returns. Our OW rating and $150 PT are underpinned by a preference for 1) quality players with scale and 2) defensive retailers in the current COVID-19 environment,” said Simeon Gutman, equity analyst at Morgan Stanley.

“We think the launch of Walmart+ could serve as a sustainable positive tailwind for the stock (assuming the program benefits are made clear through disclosure of subscriber numbers or higher sales growth). In our base case we have estimated up to 20 million members may be willing to sign up for Walmart+ within six months of launch (per our AlphaWise survey data). Assuming a 1.7x spending uplift for existing Walmart shoppers that sign up for the program and breakeven e-commerce operations by the fifth year of membership yields $30 billion of NPV for Walmart ($10/share).”

Upside and Downside risks

Upside: 1) Comps accelerate to +MSD-HSD led by continued Grocery strength. 2) Sustainable US e-comm growth of 50-60%+ behind Click & Collect momentum. 3) PhonePe gains wider market appreciation, driving incremental multiple expansion. 4) Walmart+ gains more traction than expected – highlighted by Morgan Stanley.

Downside: 1) E-commerce loses begin to rise again after briefly moderating. 2) US e-comm growth slows to <30% (comps <2%). 3) Greater than expected Flipkart losses.

E-mini S&P 500 Index (ES) Futures Technical Analysis – Needs to Close Over 3379.75 to Sustain Rally

September E-mini S&P 500 Index futures are expected to open higher based on the pre-market trade. Supporting the rally are bullish earnings reports from Home Depot and Walmart, which are setting an upbeat tone ahead of the cash market opening.

The benchmark futures contract hit a record high during Asian trading hours but later lost steam as caution over a Sino-U.S. spat grew after President Donald Trump announced further restrictions on tech giant Huawei Technologies Co.

At 12:07 GMT, September E-mini S&P 500 Index futures are trading 3384.25, up 4.50 or +0.13%.

Home Depot rose 2.8% in the premarket, putting it in a position to set a record high. Wal Mart shares shot higher by 5.5% in premarket trading.

In other news, retailer Kohl’s lost 25 cents per share for its latest quarter, smaller than the 83 cents a share loss that Wall Street analysts had anticipated. Auto parts retailer Advance Auto Parts earned $2.92 per share for the second quarter, well above the $1.98 a share consensus estimate.

Daily September E-mini S&P 500 Index

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. The uptrend was reaffirmed when buyers took out the last high at 3382.50 earlier in the session.

The main trend is safe for now. It will change to down on a move through 3195.00. This is highly unlikely, but due to the prolonged move up in terms of price and time, the index remains inside the window of time for a potentially bearish closing price reversal top.

The new minor range is 3319.50 to 3388.75. Its 50% level at 3354.00 is the nearest support. Look for the short-term upside bias to continue as long as this level holds. This level is dynamic so it will move up if the market continues to make higher-highs.

The short-term range is 3195.00 to 3388.75. The minor trend will change to down on a trade through 3319.50. If it does then momentum will shift to the downside with the retracement zone at 3291.75 to 3269.00 the next likely downside target.

Daily Swing Chart Technical Forecast

Given the early price action, the direction of the September E-mini S&P 500 Index on Tuesday is likely to be determined by trader reaction to 3379.75.

Bullish Scenario

Holding above 3379.75 will indicate the presence of buyers. If this creates enough upside momentum then look for buyers to make a run at the February 20 main top at 3396.50. This is a potential trigger point for an acceleration to the upside.

Bearish Scenario

A sustained move under 3379.75 will signal the presence of sellers. This could trigger a break into the minor 50% level at 3354.00.

A close below 3379.75 will form a closing price reversal top. If confirmed, this could trigger a 2 to 3 day correction.

For a look at all of today’s economic events, check out our economic calendar.

Healthcare Could Be Silver Bullet for Walmart in Long Term; Target $140: Morgan Stanley

Walmart Inc, an American multinational retail corporation that operates a chain of hypermarkets, has recently moved into the healthcare space with its own insurance business which could be a ‘silver bullet’ for the world’s largest retailer over the long-term, according to Morgan Stanley.

Walmart on July 8 revealed that it has created an insurance company named ‘Walmart Insurance Services LLC’ to sell Medicare insurance with its groceries and clothing, starting from August.

“There is scant detail around Walmart’s overarching health strategy aside from the fact that it wants to improve access to, and reduce the costs of, healthcare in the US. From that perspective, a multi-pronged approach makes a lot of sense and recent steps are clear indications this is what Walmart is pursuing. We don’t know if/how Walmart plans to directly monetize CareZone, or the details of its pricing/distribution strategy in relation to selling health insurance,” Morgan Stanley’s analysts wrote.

In June, Walmart bought CareZone’s medication management technology and intellectual property, in a move to strengthen its digital health presence. The largest retail corporation owns four health centres in the United States, which provides counselling and dental care to its customers at a low price – annual checkup for $30 or a strep test for $20.

“These two initiatives are certainly going to be immaterial to Walmart’s P&L in the near- to medium-term. However, its huge customer base and a gigantic market opportunity to reduce inefficiencies make Walmart’s deeper foray into healthcare sensible, in our view. We expect to see its suite of initiatives grow over time,” analysts added

Morgan Stanley target price is $140 with a high of $180 under a bull scenario and $100 under the worst-case scenario.

“Comps accelerate to +MSD-HSD led by continued Grocery strength. Sustainable U.S. e-comm growth of 50-60%+ behind click & collect momentum and traction with long-tail assortment. PhonePe gains wider market appreciation, driving incremental multiple expansion,” Morgan Stanley highlighted as upside risks to Walmart.

“E-commerce losses begin to rise again after briefly moderating. U.S. e-comm growth slows to <30% (comps <2%). Greater than expected Flipkart losses,” Morgan Stanley highlighted as downside risks to the world’s largest retailer.

Twenty-three analysts forecast the average price in 12 months at $138.15 with a high forecast of $150.00 and a low forecast of $120.00. The average price target represents an 8.14% increase from the last price of $127.75, according to Tipranks. From those 23, 19 analysts rated ‘Buy’, four analysts rated ‘Hold’, and none rated ‘Sell’.

“As the lines between Retail, Healthcare & Tech blur, WMT’s growing suite of initiatives make it a sleeping giant to watch,” analysts added.

Walmart Premium Service Could Ignite Buying Interest

Dow component Walmart Inc. (WMT) rallied nearly 7% in Wednesday’s U.S. session after a Recode report alleged the retail giant will launch a premium delivery service that competes head-to-head with rival Amazon. Com Inc. (AMZN). If confirmed, the Walmart+ service will launch later this month, adding to online market share that’s been growing at a torrid pace since 2016, when the company acquired Jet.Com.

Walmart Pandemic Sales Surge

Walmart rocketed higher in March, picking up brick and mortar sales from hundreds of smaller retailers forced to close down as a result of the pandemic.  Online sales boomed as well in the first quarter, posting a phenomenal 74% year-over-year growth rate, underpinned by millions of folks forced to surf the web to buy household essentials. The stock posted an all-time high in April but price action has been sluggish in the last three months, with market players reallocating their buying power to reopening plays.

UBS analyst Michael Lasser upgraded the stock in June, citing bullish earnings expectations as a result of an “enhanced productivity loop, e-commerce scale, and accelerated technology deployment.” He wrapped up his upbeat report, noting that Walmart “offers the prospect of best-in-class consistency in an uncertain environment. We believe these elements will enable WMT shares to maintain a premium multiple, especially as the gap between the leaders and laggards in retail widens.”

Wall Street And Technical Outlook

Wall Street consensus translates into a “Strong Buy” recommendation, with 19 ‘Buy’, and 4 ‘Hold’ ratings. No analysts are recommending that shareholders sell the stock at this time. Price targets currently range from a low of $120 to a street high $150 while the stock is now trading about $13 below the median $138 target. This bullish placement bodes well for continued gains in the third and fourth quarters.

Heavy second quarter selling pressure mars an otherwise bullish technical outlook. Walmart pulled back about 16 points off the April peak into June, where it carved a small basing pattern that’s now acting as a platform for higher prices.  However, accumulation-distribution readings fell to a 15-month low at the same time and the stock will need to find new sponsorship to power a sustained uptrend toward 150. As a result, sidelined investors may wish to wait for a breakout above the April high at 133.

S&P 500 Earnings Preview – Walmart and Home Depot Headline Tuesday’s Earnings Releases

There are several large retail giants scheduled to release financial results this week. Tuesday will see some of the biggest retailers kick off the week.


Walmart (WMT) is scheduled to release financial results on Tuesday, May 19. The retail giant is expected to report earnings of $1.17 per share on 130.31 billion in revenue.  This compares to 1.43 per share in the quarter prior. Earnings forecasts are unchanged over the last 30-days, which is a positive sign given the recent declines in most forecasts. Growth estimates are expected to increase by 3.5%. The company reported in April that Alcohol sales increased 350% year over year and grocery sales were up more than 30% year over year.

The stock price is approximately $5 per share off the all-time highs, and a beat will likely propel the retail giant to fresh highs.

Home Depot

Home Depot (HD) the home improvements conglomerate is scheduled to release financial results on Tuesday, May 19. The company is expected to earn $2.26 per share on $27.38 billion in revenue. This compares to $2.1 in earnings in the quarter prior. Analyst forecasts of earnings have declined $0.03 during the past 30-days. Growth estimates are for a decline of less than 1%.

The stock price broke out to fresh all-time highs just before the earnings release. With home prices remaining at elevated levels, the stock should continue to benefit from robust revenues rising as the trend pushes higher.


Kohl’s (KSS) is expected to release financial results on Tuesday, May 19. The company is expected to earn -$1.75 per share on $2.16 billion in revenues. This compares to $2.88 in earning in the prior quarter. Earnings forecasts have declined by more than $1.02 per share over the last 30-days.

Most of Kohl’s stores were closed during the “shelter in place” orders. Its customers are generally middle-income customers, that have lost jobs over the past 8-weeks. The shares are unlikely to see a positive upside until a vaccine is released.

Global Crisis: Time to Enter the Market

If fundamentals stay as they are, we are likely to see the market gradually recover its losses, half of which are already reconquered. That makes this moment attractive to buy stocks. If we witness this moment, it will be the perfect timing to buy stocks. All you need is to choose a suitable trading platform. FBS Trader offers low spreads and fast deposits and withdrawals. So, why not? You can consider the following notable performers.


Strategically, Disney’s stock was rising in value before the virus came. The company also launched its Disney+ streaming service at the end of 2019, which made the price surge even higher – to the all-time high of $150. Therefore, it has all the fundamentals to rise when the virus outbreak is finally over. Paying $100 now for something that used to cost $150 is a rare discount. You can take this chance and buy or sell Disney’s stock in new and innovative app from FBS. In the short term, look at $120 per share as the resistance to be tested and probably broken.


Walmart is on the list because of its strong fundamentals and a huge discount. Walmart is here for the same reason. At the same time, there’s more to this stock: although at a discounted price, it didn’t fall as much as most of its peers did. In fact, it’s one of the few shares that proves to be quite resilient to the virus-led plunge. Therefore, it makes sense to look at the current price and think of buying one of the strongest market performers that was traded at $125 a couple of months ago. With the pending order feature in the FBS Trader app, you can profitably buy stocks and select at which price level a position should be opened.


NVIDIA is interesting because it represents the foremost frontier of the progress: virtual reality, video games, cloud technologies, etc. After the company sorted out its problems in 2018, it went into steady growth. There are reasons to expect that it will keep the line after the virus is gone. Now at $244, it is down 24% from its recent record – a significant discount for this share. The logic to take it is “buy the future”. And it is possible with FBS Trader app, which offers essential features for trading, such as instant deposits and withdrawals within over 100 payment systems.


Don’t be surprised to see Coca-Cola here. Actually, never be surprised to see it under any circumstances – it is one of the few century-old stocks that survived wars and pandemics and will survive us. If you like the logic “if Warren Buffett has it, I will have it”, you should like this stock. The price of $41 is offered for a $60-worth stock in March. Fortunately, FBS Trader provides you with online access to trading worldwide – anywhere and anytime. You can use the chance to buy Coca-Cola stocks at the time that suits you best.


Payment processing will recover before other industries wake up. This stock looks especially good as Chinese authorities allowed Mastercard to establish clearing services in China, and China is already on the way out of the virus-oppressed state. Mastercard looked strong before, it looks strong now, and trades at $256 after $347 – an offer one cannot lose, especially when you have the app for traders that opens up new opportunities.


UK Down On Brexit Woe, Pound Sinks, Asian Up On Brexit Hope, US Dollar Moves Higher

Asian Markets Move Broadly Higher On Brexit Hopes

Asia, led by China, moved broadly higher in Thursday trading, extending a bounce that began earlier in the wee. The Hong Kong-based Heng Seng led advancing indices with a gain of 1.75% followed by a 1.36% gain for the Shang Hai Composite. The Korean Kospi advanced nearly 1.0% on word a draft-Brexit had been written while the Australian ASX and Japanese Nikkei closed closer to break-even. The Japanese Nikkei was Thursday’s laggard posting a loss near -0.20%.

China’s equity markets were also supported by word the Chinese government had sent a written response to Washington’s demands. The details of the letter are not yet known but the sentiment is positive in light of the recently reduced tension between the US and China. Chinese President Xi Jinping and US President Donald Trump are slated to meet at the G-20 Summit in order to discuss improving trade relations.

EU, UK Down On Brexit Resignations

The UK and EU markets were initially higher on easing fear a hard-Brexit was inevitable. Those fears came back to the forefront soon after the open and reduced gains to near 0.25% for the FTSE 100 and Xetra DAX by midmorning. The CAC was the laggard posting mid-morning a loss of -0.20%.

In the UK, tensions over the draft-Brexit have split Theresa May’s parliament resulting in the resignations of several key members including the Brexit Secretary Dominic Raab. Raab says he can not support the current Brexit plan in light of promises made to the British people by ruling party members before the referendum was taken. The Brexit news had a negative impact on the pound. The GBP/USD and EUR/GBP both shed nearly -1.50% on the news.

US Markets Brace For Data, Dollar Moves Higher

The US futures market was indicating a positive open for equity indices in the early hours of the morning. Traders wary of geopolitical events were focused on a raft of economic data that produced a mixed bag of results. After the 8:30 AM data deluge futures pared their gains to indicate an open near break-even.

Retail sales figures came in hotter than expected at 0.80%. This is 0.3% hotter than expected and points to continued strength in the consumer. On the manufacturing front, the Philly Fed’s MBOS fell nearly 10 points to 12.9, far below expectations, on weakness in New Orders. The Empire State Manufacturing Survey counterbalanced MBOS by advancing 2.0 points to 23.3 in evidence of expanding activity in the New York Federal Reserve District.

Earnings reported released before the open on Thursday were good but did not spark a rally in equities. Both WalMart and Cisco reported top and bottom line results that beat the analyst’s consensus and provided a positive outlook. Walmart rallied a little more than 1.0% on the news while Cisco advanced a more robust 4.0%. NVIDIA tops the list of companies reporting earnings after the bell on Thursday. The company is expected to post YOY gains but the result may be negatively impacted by weak sales of cryptocurrency mining chips.

Wal-Mart Stores Inc (NYSE:WMT)’s Q1 Results Beat Estimates As Online Sales Improve

In the previous quarter Walmart had a disappointing performance with regards to online sales in the United States but this time round revenues from the e-commerce operations grew by 33%, an indication that the investments the big box retailer has made in its website design and online grocery is paying off.

While Wall Street had been expecting earnings per share to come in at $1.12, the actual figure was $1.14. Thomson Reuters had been forecast revenue to amount to $120.51 but it instead came in at $122.69 billion.

“Online grocery continued to accelerate and [we] had the new site redesign late in the quarter. We also have new brands in e-commerce including the partnership with Lord & Taylor, so there are a lot of different things driving growth there,” said the Chief Financial Officer of Walmart, Brett Biggs, in a CNBC interview.

Increased optimism

Walmart is now optimistic about its e-commerce operations and expects to grow online sales by 40% for the entire year. The rebound in e-commerce follows a sharp slowdown which occurred over the crucial holiday quarter. This resulted in the shares of the online retail giant falling by more than 10% wiping out shaving off approximately $31 billion in market cap.

According to Marc Lore, Walmart’s e-commerce chief, the redesign of the website is estimated to have enhanced traffic to the big box retailer’s online grocery business by between 10% and 20%.

With regards to international operations sales grew by 4.5%. Currently Walmart is reorganizing its global business portfolio. In Walmart’s largest deal ever the retailer will buy a 77% stake in Flipkart, an Indian e-commerce firm, at a price of $16 billion. The world’s second most populous country boasts of 300 million millenials who are tech savvy and this makes it a highly lucrative market that is poised for growth. Walmart also intends to dispose of a majority interest in Asda Group, a grocery chain in the United Kingdom, to J Sainsbury.

Four straight years of growth

The big box retailer now boasts of four straight years during which it has enjoyed growth in the United States and this is a record no other retailer can match. While the rising gas prices may have reduced the purchasing power of some, Walmart indicated that it was still enjoying robust consumer demand. However consumer traffic growth during this year’s first quarter was lower than last year’s – in the first quarter of this year consumer traffic growth was 0.8% compared to last year’s 1.5%. This was attributed to the delayed spring which made customers consolidate trips. The delayed spring also hurt demand with regards to weather-related categories.

The growth of Walmart’s online grocery pickups is coming at a time when, Inc. (NASDAQ:AMZN) is making chess moves of its own. Just this week the online retail giant announced that when Prime members do their shopping at the outlets of Whole Foods Market, they will get special discounts. Amazon acquired Whole Foods Market last year.