Executive Summary

• Walmart reported 3Q17 EPS of $0.98 versus the consensus estimate of $0.96.
• Walmart US comps were up 1.2% versus consensus of 1.4% and guidance of 1.0%–1.5%. Traffic at Walmart US was up 0.7%, while average ticket increased by 0.5%. E-commerce added 50 basis points to comps, which was the channel’s largest contribution to date. The company experienced a favorable back-to-school season to start the quarter, although that strength was offset by unseasonably warm weather that negatively impacted apparel, and cold weather categories in particular.
• The company’s 4Q17 guidance calls for EPS of $1.18–$1.33, driven by a comp increase of 1.0%–1.5% at both Walmart US and Sam’s Club, versus consensus of 1.5% and 1.0% comp growth, respectively.