Walmart (NYSE: WMT) rose 3% on Tuesday morning, after posting earnings that beat Wall Street expectations.
While our analysis indicates some near term upside is possible, we believe the odds point lower in the coming months.
The retailer reported earnings per share of $1.41 and total revenue of $138.8 billion, above analyst estimates of $1.33 and $138.7 billion. Walmart’s same store sales increased 4.2%, compared to the consensus of 3.2%.
CEO Doug McMillon explained that a “favorable economic environment” and strong holiday sales contributed to better-than-expected performance.
In analyzing its market cycles for Walmart’s stock price (WMT), we can see the stock is still in the rising phase of its current cycle. It moved up through a “sell zone” and is now moving towards a near term peak around $107.
That should be a tough level, with a likely correction down to $99 by late April.
Walmart (WMT) Stock Weekly Chart
For more from Slim, or to learn about cycle analysis, check out the askSlim Market Week show every Friday on our YouTube channel.
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