Exploring 2 retail stocks close on the heels of earnings: WMT and HD

August 16, 2022 08:47 AM PDT | By Rupam Roy
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  • Both WMT and HD stock rallied on Tuesday morning following their quarterly earnings release.
  • Walmart Inc. (NYSE: WMT) posted a growth of over eight per cent in its second-quarter revenue.
  • The Home Depot, Inc. (NYSE: HD) reported a jump of over six per cent in its Q2 FY22 net sales.

Retail giants, Walmart Inc. (NYSE: WMT) and The Home Depot, Inc. (NYSE: HD) gained investors’ attention on Tuesday, August 16, 2022, after posting their quarterly earnings results before the opening bell. Both WMT and HD stock stayed on the green in the morning trading on August 16, 2022.

Let's dive deep with Kalkine Media® into the earnings highlights of both retail giants:

Walmart Inc. (NYSE: WMT)

The WMT stock rose about 5.84 per cent to trade at US$ 140.345 at 10:54 am ET on August 16, 2022, following its quarterly earnings release. The US$ 384.52 billion market cap firm had a dividend yield of 1.69 per cent and its annualized dividend is US$ 2.24.

The Bentonville, Arkansas-based company noted an 8.4 per cent growth (YoY) in its second quarter fiscal 2022 total revenue of US$ 152.9 billion. Walmart said that it posted strong top-line growth globally, mainly due to the higher inflation.

The firm posted a consolidated net income of US$ 5.14 billion, or US$ 1.88 per diluted share in Q2 FY22, up 17.9 per cent from US$ 4.36 billion, or 23.7 per cent from US$ 1.52 per diluted share in Q2 FY21.

Among its other recent developments, Walmart seems to be taking its membership offering to a whole new level. On August 15, the discount store operator announced adding a streaming benefit for its customers.

As per the announcement, a Walmart+ subscription would soon be available for the members through which it would provide access to Paramount + Essential subscription at no extra cost.

Earnings highlights of Walmart Inc. (WMT) and Home Depot (HD)Source: ©Kalkine Media®; © Canva via Canva.com

The Home Depot, Inc. (NYSE: HD)

The HD stock climbed nearly four per cent on Tuesday morning, August 16, 2022, to trade at US$ 326.89. The US$ 336.18 billion market cap firm had a dividend yield of 2.41 per cent.

Talking about its earnings, the Atlanta, Georgia-based firm posted a 6.5 per cent jump or an increase of US$ 2.7 billion in its second quarter fiscal 2022 sales of US$ 43.8 billion.

Home Depot's net earnings for the second quarter of fiscal 2022 was US$ 5.2 billion, or US$ 5.05 per diluted share, comparatively up from an income of US$ 4.8 billion, or US$ 4.53 per diluted share in Q2 FY21. Its diluted earnings per share surged 11.5 per cent year-over-year (YoY).

The home improvement retailer had reaffirmed its guidance for fiscal 2022. It expects the sales growth and comparable sales growth to be about three per cent in fiscal 2022. In addition, it also expects its diluted EPS percent growth to be mid-single digits. 

Bottom line:

The earnings season has turned out to be a boon for the market so far. Several other major retailers, as well as technology firms, are expected to report their quarterly financial results this week, which would be closely watched by the traders.

However, investors should also evaluate the highly volatile conditions and other uncertainties in the market before picking their stocks.


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