SPY - Walmart: A Premium P/E On This Discount Retailer

2024-03-25 17:32:39 ET

Summary

• A mixed February Retail Sales report highlights potential weakness among US consumers as we head into the second quarter, though the jobs market remains solid.
• Walmart continues to execute well with rising earnings and industry-leading positioning, but investors are confronted with a high earnings multiple.
• Walmart's technical situation is strong, with a solid uptrend and potential for higher prices ahead - I highlight key price levels to watch ahead of key corporate events.

The February Retail Sales report was mixed. While there was a spending bounce back last month, negative revisions underscore potential emerging weakness among US consumers. That sentiment was largely echoed in earnings reports and outlooks from Nike ( NKE ) and Lululemon ( LULU ) last week as we approach the end of the first quarter. Still, the labor market remains on solid footing given Initial Jobless Claims numbers that continue to range in a sweet spot between 200k-250k each week. ...

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