Episode Details

Walmart (WMT) Q2 FY2027 — Walmart reported fiscal Q2 2027 on an 8-K accepted 06:59:01 ET on Thursday August 20 (EDGAR filing-index page) - a BEFORE-THE-OPEN print, so Thursday Aug 20 is the reaction session and Friday Aug 21 has also settled. Shares closed USD103.84 against USD114.30, DOWN 9.15 pct, the 4th worst of 4,999 close-to-close sessions since October 2006, on 83,633,145 shares, 3.89x the 20-session median. Three quarters of the fall was the overnight gap: it OPENED at USD106.38, down 6.93 pct, before a share traded. Friday closed USD103.70, down 0.13 pct. No bounce. Walmart (NASDAQ: WMT) is the largest retailer on earth: roughly 280 million customers a week across more than 10,900 stores in 19 countries, about 2.1 million associates, and USD713 billion of fiscal 2026 revenue. It reports under US GAAP in US dollars on a fiscal year ending 31 January, so the quarter ended 31 July 2026 is the SECOND quarter of fiscal 2027. Its three segments are Walmart U.S., Walmart International and Sam's Club U.S. John Furner is President and CEO; John David Rainey is chief financial officer. THE CALL: HOLD (3/5, MEDIUM - THE DE-RATING WAS RIGHT, AND IT IS NEARLY FINISHED) — base-case value ~$99.99 vs ~$103.7 today. KEY METRICS: - Q2 FY2027 total revenue USD187.937B, up 5.9 pct and 5.1 pct in constant currency, clearing a USD186.641B estimate. Net sales USD186.100B; membership and other income USD1.837B, up 11.2 pct. Operating income USD9.383B against USD7.286B, up 28.8 pct reported and 17.4 pct adjusted cc. Gross profit rate up 96 bps to 25.41 pct. Adjusted EPS USD0.81 against USD0.68 and a USD0.742 bar, a 9.2 pct beat - while GAAP EPS FELL 9.1 pct to USD0.80. - Guidance RAISED: FY27 adjusted EPS USD2.80-2.87 from USD2.75-2.85, net sales cc up 4.0-5.0 pct from 3.5-4.5 pct, adjusted operating income cc up 7.0-8.5 pct. But Q3 is set at USD0.62-0.64 against a USD0.67 vendor consensus row, 6.0 pct below it. Capital spending guidance went from about 3.5 pct of net sales to about 4.0 pct, roughly USD3.7B more. Walmart U.S. comparable sales grew 2.6 pct against 4.6 pct a year ago. - The de-rating in one line: the guidance midpoint rose 1.25 pct, from USD2.800 to USD2.835, while the multiple fell 10.27 pct, from 40.82x to 36.63x - and those two terms multiply to the exact minus 9.15 pct that printed. Walmart closed fiscal 2022, 2023 and 2024 at 21.8x, 22.9x and 24.9x adjusted earnings, then 39.1x and 45.1x. Six-month capex up 24.3 pct; six-month free cash flow down 20.4 pct to USD5.529B. What to watch: The Q2 FY2027 8-K accepted 06:59:01 ET on 20 August 2026 and its Exhibit 99.1, read against the Form 10-K for the year ended 31 January 2026. Adjusted EPS of USD0.81 cleared a USD0.742 bar and revenue of USD187.937B cleared USD186.641B - and the company RAISED full-year adjusted EPS guidance to USD2.80-2.87 from USD2.75-2.85. The shares fell 9.15 pct anyway. Nine sell-side firms then cut their targets by an average of 9.65 pct, and not one cut a rating. Also on YouTube: @ChargedAlpha DISCLAIMER: For informational and educational purposes only. Not financial advice. Do your own research before any investment decision.