- Current Market Cap – $351.21 Billion<\/li>
- Enterprise Value – $417.58 Billion<\/li>
- PE GAAP \u2013 23.57<\/li>
- Price to Book \u2013 5.14<\/li>
- EV\/Sales \u2013 0.78<\/li>
- Return on Equity \u2013 20.63%<\/li>
- Return on Assets \u2013 5.83%<\/li><\/ul>\n\n\n\n
Overview of the Quarters Results<\/h1>\n\n\n\n
Walmart reported that U.S. comp sales were up 10% for the quarter, and the eCommerce sales grew 74%.<\/p>\n\n\n\n
Walmart also reported first-quarter GAAP earnings per share of $1.40, with adjusted earnings of $1.18. Along with that, the company also reported incremental costs as a result of Covid-19 of nearly $900 million.<\/p>\n\n\n\n
Walmart U.S. Quarterly Financial Highlights<\/h1>\n\n\n\n
Sales<\/strong><\/p>\n\n\n\n
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<\/figure>\n\n\n\nChart courtesy of Walmart Quarterly Presentation<\/a><\/p>\n\n\n\n\n\n\n\n
Walmarts comp sales increased ten percent for the first quarter, with the comp ticket higher by 16.5 percent, while comp transactions fell by 5.6%.<\/p>\n\n\n\n
Walmart attributes much of the increases as a result of the Coronavirus pandemic and the stay-at-home orders. As a result, Walmart observed consolidated shopping trips and larger average baskets and a shift more towards eCommerce.<\/p>\n\n\n\n
E-commerce saw strong sales growing at 74%, which contributed 390 points approximately to the segment growth comp. Store pickup and delivery, ship to home, ship from store, and marketplace channels were all strong throughout the quarter. Again the growth could be directly tied to Covid-19 and consumer’s reactions to changes in the workplace and home restrictions.<\/p>\n\n\n\n
On month by month basis for the quarter, February saw comp sales grow by 3.8 percent. By mid-March, Walmart saw stock up trips surge, which increased March comp sales by 15.4 percent. In April, store sales slowed the first half of the month but picked up by the middle of the month as government surplus checks started arriving, all of which contributed to a 9.5 percent increase in sales comp.<\/p>\n\n\n\n
All in all, Walmart saw strength across all U.S. segments, particularly in food, health & wellness, and consumables. The only segment that saw decreases were discretionary areas like apparel.<\/p>\n\n\n\n
Gross Profit Rate<\/strong><\/p>\n\n\n\n
Walmart saw a decrease in the gross profit rate of 113 basis points as a result of carryover from last year’s price investments. There was also a crisis-related switch in sales mix to lower-margin categories. And shifts in channel mix towards eCommerce, general merchandise markdowns, and temporary closings of the Auto and Vision as a result of social distancing guidelines.<\/p>\n\n\n\n
Expenses<\/strong><\/p>\n\n\n\n
Walmart’s strong sales contributed to operating expense leverage of 89 basis points despite the increased pressure of approximately $670 million in Covid-19 related costs. Increases in associate investments, wage increases, and increased maintenance costs related to cleaning were all offset by the decrease in marketing, travel, and consulting costs.<\/p>\n\n\n\n
Operating Income<\/strong><\/p>\n\n\n\n
Walmart’s operating income was also affected by a decline in Other income as a result of Covid-19 temporary closures of instore tenants and revenue lost as a result of the closures.<\/p>\n\n\n\n
Inventory<\/strong><\/p>\n\n\n\n
Walmart’s inventory declined 6.1 percent as a result of being out of stock in some categories. All a result of the Covid-19 stocking up by consumers.<\/p>\n\n\n\n
Format Growth<\/strong><\/p>\n\n\n\n
During the quarter, Walmart closed two Supercenters and one Neighborhood Market and remodeled 80 stores. As of the first quarter, Walmart reported they had nearly 3,300 pickup locations, and 1,850 stores with same-day grocery delivery and Express Delivery was launched.<\/p>\n\n\n\n
Walmart International Quarterly Financial Highlights<\/h1>\n\n\n\n
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