Walmart sticks to conservative annual targets, shares decline 7%

Walmart maintained cautious annual targets despite strong sales growth, sending its shares down over 7 per cent

Walmart stuck to its conservative annual sales and profit targets on Thursday, driving shares down even as rising fuel costs drove bargain-hunting shoppers ??to its low-priced groceries and essentials. US retailers have flagged growing pressure on consumer spending this year, with sentiment falling to a record low in May and inflation posting its largest gain in three years. 

Walmart’s first-quarter operating income rose 5 per cent to $7.49 billion, while net sales climbed 7.1 per cent to $175.7 billion. 

CEO John Furner, however, retained the company’s ‌annual forecast, which analysts have described as conservative: a net sales growth target of ​3.5 per cent to 4.5 per cent, and earnings per share between $2.75 and $2.85. The ​company said it expects net sales to be near the top of that guidance. Shares fell more than 7 per cent on the conservative forecast. The world’s largest retailer has been largely insulated from weak spending as its scale helped it keep prices low despite tariffs and geopolitical volatility.