Past performance and outlook
Walmart (WMT) impressed investors with its sales performance in the first nine months of the current fiscal year. It beat analysts’ sales estimates in the past two quarters and remains on track to end the year on a strong note due to its bulging online sales. Walmart also managed to improve its store traffic through value pricing and supply-chain reinvention.
Walmart remains upbeat and expects its top line to grow 3% on a currency neutral basis in fiscal 2019. Analysts expect the company’s sales to grow 2.7% to $512.2 billion in fiscal 2019. For the current fiscal year, analysts project a 2.6% rise in the company’s top line.
What could drive Walmart’s sales?
Walmart has taken several strategic measures, especially on the e-commerce front, that should drive its top-line growth in coming years. Walmart’s shift to its digital business strengthened its position against the growing threat from Amazon (AMZN). The shift has also been the key catalyst for the company’s turnaround.
Walmart’s series of strategic acquisitions, the addition of in-vogue brands to its website, and popular services like online grocery pickup and fast delivery mechanisms are expected to drive its sales.
Walmart’s price investments, fresh offerings through reinventing the supply chain, store remodeling, and multi-channel offerings are expected to drive its sales higher.
In comparison, rival Costco (COST) is outperforming Walmart with its stellar top-line growth due to its rising store traffic. Target (TGT), which has been battling slowing store traffic, is finally seeing signs of revival.