Investors in Walmart Inc. (NYSE:WMT) had a good week, as its shares rose 4.6% to close at US$88.39 following the release of its third-quarter results. Walmart reported US$168b in revenue, roughly in line with analyst forecasts, although statutory earnings per share (EPS) of US$0.57 beat expectations, being 6.8% higher than what the analysts expected. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Walmart after the latest results.
After the latest results, the 28 analysts covering Walmart are now predicting revenues of US$704.6b in 2026. If met, this would reflect a reasonable 4.6% improvement in revenue compared to the last 12 months. Per-share earnings are expected to expand 11% to US$2.72. In the lead-up to this report, the analysts had been modelling revenues of US$702.3b and earnings per share (EPS) of US$2.70 in 2026. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.
The consensus price target rose 11% to US$95.20despite there being no meaningful change to earnings estimates. It could be that the analystsare reflecting the predictability of Walmart's earnings by assigning a price premium. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. There are some variant perceptions on Walmart, with the most bullish analyst valuing it at US$105 and the most bearish at US$58.00 per share. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.
One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. It's pretty clear that there is an expectation that Walmart's revenue growth will slow down substantially, with revenues to the end of 2026 expected to display 3.6% growth on an annualised basis. This is compared to a historical growth rate of 5.2% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 4.5% per year. Factoring in the forecast slowdown in growth, it seems obvious that Walmart is also expected to grow slower than other industry participants.
The Bottom Line
The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.
With that in mind, we wouldn't be too quick to come to a conclusion on Walmart. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Walmart analysts - going out to 2027, and you can see them free on our platform here.
And what about risks? Every company has them, and we've spotted 1 warning sign for Walmart you should know about.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
