TSC Staff
Wal-Mart's (WMT Quote - Cramer on WMT - Stock Picks) fourth-quarter earnings edged up 4%, narrowly topping Wall Street's expectation.
The world's largest retailer, however, offered a slightly softer-than-expected guidance as it faces the continuation of a consumer spending slowdown in the U.S. The Bentonville, Ark., behemoth reported a fourth-quarter profit of $4.1 billion, or $1.02 a share, up from $3.94 billion, or 95 cents a share, a year earlier. Adjusted for charges, earnings were $1.04 a share, 2 cents better than analysts' mean estimate, according to Thomson Financial. The bottom-line results were at the high end of Wal-Mart's guidance of 99 cents to $1.03 a share. Wal-Mart's revenue rose 8.4% to $107.43 billion -- the first time any retailer has reached more than $100 billion in sales in a single quarter. Same-store sales, or sales at stores open at least a year, climbed 1.7% in the U.S. The quarter was a tough one for Wal-Mart, as well as most retailers, as shoppers pulled back on spending amid the U.S. housing downturn and ever-rising oil prices. Wal-Mart, though, has been slashing prices to bring in penny-pinching customers. "The price leadership strategy we put in place at the beginning of the year was exactly the right strategy for our customers around the world in a tough economic environment," said Chairman and CEO Lee Scott. "The combination of price leadership and improved customer service made the difference in the fourth quarter for our U.S. operations." For the new fiscal year, Wal-Mart forecast earnings of $3.30 to $3.43 a share, allowing for downside to Wall Street's target of $3.43. In the current quarter, Wal-Mart anticipates a profit of 70 cents to 74 cents a share, also somewhat weaker than analysts' 74-cent projection. "We know that the economy remains a critical factor in this new fiscal year," Scott said. "Customers were more cautious in their spending in January. In a volatile economy, I believe we are well positioned to succeed."
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