Published: Fri, May 19, 2017
Money | By Armando Alvarado

Wal-Mart's Online Sales Surge, Tops 1Q Expectations

The company's Q4 report tagged its e-commerce growth at Walmart a 63% sales increase, with the majority of that push coming organically through The retailer reported $1.00 earnings per share for the quarter, beating the Thomson Reuters' consensus estimate of $0.96 by $0.04. Consolidated net income fell to $3.04 billion from $3.08 billion due to an increase a higher tax rate.

Target's first-quarter profit rose nearly 8 percent as attempts to turn its business around appear to be gaining some traction. "So overall we're making progress in providing the seamless shopping experience our customers desire and we will keep moving along this journey".

The biggest of those deals, in which Walmart paid $US3.3 billion ($4.4 billion) for the bulk e-commerce retailer a year ago, was part of the plan to offer customers more products through the web.

In after-hours trading, Gap climbed more than 3% after reporting a quarterly profit that beat expectations.

The Standard & Poor's 500 index rose 8.69 points, or 0.4%, to 2,365.72. Lidl is known for low prices and its emphasis on store brands.

On the other hand, president and CEO, Walmart eCommerce U.S., said, "Customers are placing more repeat orders and spending more".

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Wal-Mart spent more than $3 billion for in its bid to lure younger and more affluent customers. Wal-Mart now offers 50 million items through its website, up from 35 million in the last quarter and 10 million in the same quarter of a year ago. Investors were weighing quarterly results from Wal-Mart Stores and other big retailers. Zacks Investment Research upgraded shares of Wal-Mart Stores from a "hold" rating to a "buy" rating and set a $84.00 price target on the stock in a report on Tuesday, April 25th. The New Zealander also is beefing up the retailer's store-brand and services business to provide a buffer against both Amazon and German discounter Aldi.

During the first quarter, USA e-commerce sales surged 63%, boosted by the purchases of online retailer in September and smaller e-commerce sites ModCloth, Moosejaw and ShoeBuy earlier this year.

"We reported another excellent quarter, with revenue growth accelerating to 60%, the highest growth rate we've achieved since our IPO". Even more alarming, Slice estimated that Amazon captured 53% of the growth in the USA e-commerce market a year ago. Comparable store sales were down 9 percent, hurt by the exit in swim and apparel at Victoria's Secret. Chief Executive Doug McMillon said the purchases help add to Wal-Mart's assortment of online products, but the company won't "buy our way to success".

He still sees plenty of room for improvement despite the first-quarter progress. Although Seattle-based still leads the field by a wide margin, with Q1 fiscal 2017 ecommerce sales of $23.73 billion, Walmart is working hard to give the online giant a run for its money. The company had revenue of $116.53 billion for the quarter, compared to analyst estimates of $117.01 billion. That marked the 11th-consecutive period of positive sales in the company's home market. BofA/Merrill raised its rating on Wal-Mart Stores, Buy on 22/02/2017 in a reversal from its prior Neutral rating.

Wal-Mart Stores, Inc. has a consensus hold rating from 34 Wall Street analysts, and the number of shares now sold short amount to at least 2.57% of shares outstanding.

"We feel good about the momentum across the business and we expect progress to continue", Chief Financial Officer Brett Biggs said. "We remain confident in our strategy and are moving with speed to deliver value to our customers, associates and shareholders".

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