Diamonds and Dogs

8/16/18

Walmart (WMT) flexing its muscle. The retailing giant is up 10% to a 8 month high following earnings. Walmart beat by 7 cents as sales rose 4.2% year over year to $127.06 billion ahead of estimates. U.S. comps were +4.5% vs. estimates for +2.4%, led by the performance of grocery, apparel and seasonal. Strong comp sales were supported by traffic and ticket growth as each exceeded 2.0%. Sam's Club comp sales increased 5.0%, the strongest growth in six years. E-commerce sales grew 40 percent, up from 33 percent growth in the previous quarter. The retailer said it is on track to increase U.S. e-commerce sales by 40 percent for the full year. Take that Amazon.

No good answers at J. C. Penney (JCP). The once proud retailer is down 22% heading to zero following disappointing earnings. The company missed estimates by 35 cents as sales fell 7.5% year over year to $2.76 billion. JC Penney also lowered guidance for 2019, to a loss of a ($1.00) - ($0.80) from ($0.07) - $0.13, excluding non-recurring items. JC Penney is also looking for a CEO. With a market cap of $587 million and total debt of over $4 billion and limited cash flow, JC Penney better hurry up before the stock goes to zero.