
At an investor day presentation Thursday, Wal-Mart Stores Inc. (NYSE: WMT) said it continues to expect adjusted earnings per share (EPS) of $4.15 to $4.35 for its 2017 fiscal year ending in January. That’s below fiscal year 2016 adjusted EPS of $4.59, but higher than the company first estimated back in February.
Net sales are forecast to rise about 3% on a constant currency basis and the company expects capital spending of $11 billion in fiscal 2017, and a compound annual growth rate of 3% to 4% for the three years 2017, 2018 and 2019. Operating cash flow is projected at $80 billion over the three-year period.
Based on the current fiscal year’s EPS estimate (which excludes a $0.14 per share gain related to the Yihaodian sale), Wal-Mart expects fiscal 2018 EPS to be flat and 2019 EPS to fall at the low end of a previously forecast increase of 5% to 10%, primarily as a result of the company’s recent $3.3 billion acquisition of Jet.com.
Capital spending on new Wal-Mart supercenters and Sam’s Club stores has been declining and will decline further in fiscal 2018. Remodeling and more investment in logistics and, especially, e-commerce are intended to shift the revenue stream from new brick-and-mortar stores to the company’s new e-commerce offerings.
That shift won’t be easy, but the target is not too far to reach. Wal-Mart’s e-commerce revenues last year totaled about $14 billion of total revenues around $480 billion. If the company can execute its e-commerce strategy of adding 500 new online grocery locations to the 600 it expects to have operating at the end of this year and expanding its e-commerce merchandise offerings, it has a chance of pushing e-commerce sales from new initiatives seriously higher.
Even though Wal-Mart said it is committed to completing its $20 billion share repurchase authorization by the end of the 2018 fiscal year, investors looked at the lowered EPS expectations and took the stock down more than 2% on Thursday, to $70.08 in a 52-week range of $56.30 to $75.19. The 12-month consensus target on the stock is $76.19 per share.
100 Million Americans Are Missing This Crucial Retirement Tool
The thought of burdening your family with a financial disaster is most Americans’ nightmare. However, recent studies show that over 100 million Americans still don’t have proper life insurance in the event they pass away.
Life insurance can bring peace of mind – ensuring your loved ones are safeguarded against unforeseen expenses and debts. With premiums often lower than expected and a variety of plans tailored to different life stages and health conditions, securing a policy is more accessible than ever.
A quick, no-obligation quote can provide valuable insight into what’s available and what might best suit your family’s needs. Life insurance is a simple step you can take today to help secure peace of mind for your loved ones tomorrow.
Click here to learn how to get a quote in just a few minutes.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.