Walmart is guiding for 2-2.5% growth in comparable sales in 2023. Assuming inflation will be 3-4% over the course of 2023, achieving just 2-2.5% growth in same-store sales seems like a trivial goal. More broadly, Q4 real GDP growth was 2.9%, and I imagine Q1 real GDP growth will also be somewhat similar (say >2% annualized). So add on a few percentage points to get the nominal figure. You'd expect sales numbers to reflect that nominal level at least. Walmart's most recent quarter's comparable sales growth was 8.3% year over year.
Another Tweet highlighted how their negative guidance had basically little to do with their actual numbers but vague macro doomery.
Here is a snippet from the earnings call.
As the Tweet author said:
This answer from the WMT CFO re why they guided so conservatively is the doomer trifecta of Fed tightening, excess savings depletion and auto loan DQs. Note he doesn't point to any actual hard data from the hundreds of millions of weekly shoppers or $600B in annual sales.
Walmart has been raising prices on their items, and seem to be keeping up with inflation, while food prices have corrected besides a few anomalies.
Meanwhile, they're pointing to subprime auto loans turning delinquent, the Fed raising rates, as if… people are going to stop buying their essentials from Walmart? This isn't Whole Foods we're talking about. Walmart is a consumer staple not consumer discretionary.
I don't own any shares in WMT nor plan to buy any. Just thought the guidance was interesting.
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