Walmart not feeling the US retail squeeze
The December US retail sales report was the biggest drop in a decade. The report last week rekindled fears of a US slowdown or recession.
Yet the world's biggest retailer saw none of it. Sales at stores in the US were up 4.2% compared to 3.2% expected. The company also hiked its dividend and affirmed its 2019 forecast first released in October.
Share of the company rose 5% in the premarket.
The question is whether this was execution from the company or more of a macro story. Walmart had targeted toy sales after the bankruptcy of Toys R Us and Amazon with a revamped website. Online sales rose 43%.
There's also this:
Still, there were some potentially worrying signs in the report. Higher prices -- more than increased foot traffic -- drove the sales gains. Plus some of the gains in the quarter were more related to timing: The early release of government food-stamp payments that were supposed to have become available to American shoppers in February boosted U.S. same-store sales by 0.4 percentage points in the quarter, the company said.
In the conference call, CFO Brett Biggs cited "growing uncertainty" on the macroeconomic climate.
Overall, the report should ease some concerns about the US consumer, but not erase them.
