Why Walmart Cut its Earnings Forecast for 2019

03:46 10/19/2018

You never want to hear that monster company like Walmart cut its EPS estimates. But that’s what just happened. The company just announced it was cutting its fiscal year 2019 EPS guidance from a range of $2.90 to $3.05 to a new range of $2.65 to $2.80. Adjusted EPS was also cut from a prior range of $4.90 to $5.05 to a new range of $4.65 to $4.80. That’s not because of a slowing consumer. It has more to do with company efforts to fight back against a behemoth like Amazon.com, which is crushing traditional retail. But you know that. So why the haircut? The recent EPS trimming come courtesy of a $16 billion acquisition of India’s Flipkart, a rather large e-commerce player in India. But none of this is a surprise to anyone. In August 2018, analysts at Raymond James noted, “Flipkart will likely weight on consolidated operating earnings for the next couple of years.

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