Walmart Beat the S&P 500 Over 12 Months. What Its Chart SaysWalmart NYSE:WMT has been on a tear over the past year, rising 37.1% over the past 12 months vs. 16.1% for the S&P 500. What does the retail giant's technical and fundamental analysis say heading into this week's Q2 earnings report?
Let's check things out:
Walmart's Fundamental Analysis
As a former sergeant, I can tell you there's only one question commonly asked when the U.S. military sends someone to some small corner of America instead of a base with a post exchange: "Is there a Walmart nearby?"
If there is, you know you'll get whatever you need at a fair price. To many Americans, that's all that matters.
We'll see how much that applied in Q2 on Thursday, when Walmart reports earnings ahead of the opening bell.
Analysts expect the retail giant to report $0.74 on adjusted earnings per share on $174.2 billion of revenue.
That would represent 10.4% year-over-year earnings growth from the $0.67 in adjusted EPS that Walmart reported in Q2 2024, as well as about 3% in 12-month revenue gains
Of the 33 sell-side analysts that I found that cover Walmart, 24 have revised their earnings estimates higher since the quarter began, while five have revised their forecasts lower. (Four made no changes.)
Walmart's Technical Analysis
Now let's look at WMT's chart going back 10 months and running through Aug. 14:
Some real risk looks like it's present in this chart.
At first, I thought I saw what's called a "cup-with-handle" pattern, denoted by the purple curving line in the chart's center. That would be bullish technically.
But then I realized that I might be looking at a so-called "double-top" pattern of bearish reversal, as marked with the pink pyramids in the chart above.
Even if that's wrong, this chart still illustrates elevated risk for the stock. After all, the double-top pattern's downside pivot is all the way down at $80 -- a 20% haircut from the $100.70 that Walmart closed at on Monday.
That said, WMT's Relative Strength Index (or "RSI," denoted by a gray line at the chart's top) is better than neutral.
Meanwhile, the stock's daily Moving Average Convergence Divergence indicator (or "MACD," the black and gold lines and blue bars at the chart's bottom) appears to still be bullishly postured.
However, readers will see that the histogram of Walmart's 9-day Exponential Moving Average (or "EMA," marked by blue bars) appears to be headed lower towards the zero-bound.
Similarly, the stock's 12-day EMA (the black line) appears to be curling lower towards the 26-day EMA (the gold line). A crossover of those two lines would likely represent a short- to medium-term bearish signal.
(Moomoo Technologies Inc. Markets Commentator Stephen “Sarge” Guilfoyle had no position in WMT at the time of writing this column.)
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