What's Next For Walmart Stock & A Target Earnings Preview

Welcome to the latest episode of the Full-Court Finance podcast from Zacks Investment Research where Associate Stock Strategist Ben Rains breaks down Walmart’s (NYSE:WMT) recent quarterly financial results that helped to once again prove the retail powerhouse is ready to compete directly against Amazon (NASDAQ:AMZN) in the e-commerce age. The episode then shifts to what to expect from Target’s (NYSE:TGT) quarterly earnings, which are due out Wednesday.

Walmart topped bottom-line projections last week and its revenue roughly matched our Zacks Consensus Estimate. More importantly, Walmart's U.S. Q2 comp sales grew 2.8%, with U.S. e-commerce sales up 37%. The company’s wide array of delivery and pick up options have helped it increase its market share, and it plans to continue to expand. This will also soon include free next-day delivery offerings on qualifying orders and in-home grocery delivery services.

Walmart has also beefed up its business through acquisitions, which includes one of India’s largest e-commerce sites, Flipkart. Shares of the Bentonville, Arkansas-headquartered retailer have outpaced Amazon recently and WMT stock could attract even more investor attention as the yield on the 10-year U.S. Treasury note slips.

Meanwhile, Walmart rival Target looks solid heading into its Q2 earnings results that are due out before the opening bell on Wednesday, August 21. Like Walmart, Kroger (NYSE:KR) , Costco (NASDAQ:COST) , and many other major retailers, Target has expanded its digital and delivery businesses. The firm has also attracted more higher-income shoppers through partnerships and compelling brands from clothing to home furnishing.

Target also announced Monday morning that it will roll out its largest owned food and beverage brand called Good & Gather. This could help it draw customers away from the likes of Whole Foods. Overall, Target is a Zacks Rank #2 (Buy) at the moment that has proved to Wall Street it is able to adapt and expand in the new retail age, unlike firms such as Macy’s (NYSE:M) and JC Penney (NYSE:JCP) .

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