Updated to include comments from Walmart's media call.
In a sea of downbeat first-quarter earnings results and outlooks from retailers such as Macy's (M) - Get Report and Target (TGT) - Get Report , the world's largest retailer provided a bit of good cheer. Walmart reported first-quarter earnings Thursday of 98 cents a share, beating Wall Street forecasts of 88 cents. The company had estimated earnings of 80 cents a share to 95 cents a share. Total revenue clocked in at $115.9 billion, matching forecasts.
Walmart sees second-quarter earnings of 98 cents a share to $1.05 a share. Wall Street anticipated 98 cents a share. The better-than-expected outlook for Walmart arrives a day after Target served up tepid guidance for the second quarter, citing a post-Easter sales slowdown. Judging by Walmart's outlook, it's low prices on food and apparel may be attracting the more cautious U.S. consumer that has pulled back on shopping visits to Target and department stores this spring.
On a call with reporters, Walmart Chief Financial Officer Brett Biggs said Walmart's sales were fairly steady throughout the quarter.
Walmart U.S. delivered its seventh straight quarterly same-store sales increase. Same-store sales rose 1%, ahead of Walmart's guidance for a 0.5% increase. Walmart notched success in most areas of its store, including apparel, health and wellness and groceries. And it appears the second quarter has started on the right foot, unlike Target -- Walmart said it sees same-store sales at its U.S. division to rise 1%. Target said its same-store sales may drop as much as 2%.
"Also, very good grocery pricing [for Walmart]," said Cramer, TheStreet's founder and portfolio manager of Action Alerts PLUS. "They've really turned the jets on there. It's a great place to shop for food."
Walmart's spring-time sales momentum may be partially attributed to its workers recently getting a raise. In mid-February, Walmart raised its minimum wage for store workers hired before Jan. 1 to at least $10 per hour from $9 an hour. Walmart workers that already earned more than $10 an hour received a pay increase of about 2%.
"The simple answer is yes, we are seeing improved associate purchasing in our stores -- associates are feeling more engaged, "said Walmart U.S. President and CEO Greg Foran on the call.
"I think that the minimum wage increase has really helped [Walmart]," he said. "The retail behemoth increased the base wage for its employees to at least $10 an hour on Jan. 20, a raise for more than 1.2 million employees."
"I think if you've got a happier work force, less turnover," he said. "I remember the great Jim Sinegal, who really built Costco, was saying that the reason they always had an edge was because they had very little turnover in the workforce."