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Q3 Retail Earnings Reports: Home Depot, Walmart & Target

Plus500 | Monday 13 November 2023

Ahead of the holiday shopping season, traders, investors, and analysts alike may want to keep tabs on this week’s retail earnings releases to get a glimpse of what may lie ahead and how the global economy has fared thus far this year in the face of multiple economic hurdles and uncertainties. 

This week's anticipated retail earnings include major players such as Home Depot, Walmart, and Target, and here’s what you can expect from each company’s reports:

An illustration of stock charts

Is Home Depot in Trouble?

American multinational home improvement retailer Home Depot (HD) is scheduled to reveal its performance during the third quarter of the year on Tuesday, November 14, before market open.  

The company which had a volatile year so far, has lost over 7% of its value since the start of 2023 and is expected to report lower earnings. 

Home Depot Price Chart on 13/11/2023

According to Zacks Consensus Estimate, Home Depot is projected to report a quarterly Earnings Per Share (EPS) of $3.82 which would be a YoY drop of about 10%, and revenues of $37.67 billion which would be 3.1% lower than the year-ago quarter. 

Many seem to attribute these gloomy projections to a mixture of higher interest rates, input costs, and weakening consumer demand which may have hindered Home Depot and the home improvement stocks as a whole. 

Nonetheless, it may be worth noting that, while the home improvement sector has suffered losses this year, the overall housing market, which evidently plays a significant role in the trajectory of home improvement stocks, has had a relatively solid performance. 

Additionally, Home Depot has a track record of reporting above expectations. As such, only time will tell what tomorrow’s earnings will reveal.

Will Target Redeem Itself?

Another American retail leader, Target (TGT), is scheduled to report Q3 earnings this week on Wednesday, November 15, before the ring of the bell and it seems that some analysts hold a bearish outlook. 

According to some, Target is expected to report an adjusted EPS of $1.20-$1.60 down from the year-ago quarter’s EPS of $1.48. In addition, Q3 revenues are expected to come in at $25.3 billion which would be 4% lower than the year ago’s figures. 

These less-than-rosy figures are believed to be the result of slower consumer demand for discretionary goods and services, inventory issues, and higher rates. 

As such, it may not come as a surprise to learn that the company has lost over 28% of its value since the start of 2023. 

Target Price Chart on 13/11/2023

Can Walmart Sustain Q2’s Growth?

American multinational retail behemoth Walmart (WMT) is expected to report its Q3 earnings results on Thursday, November 16, before the ring of the bell. 

Despite this year’s economic woes and following a solid Q2 performance, the company’s Q3 sales are predicted to rise 3% YoY, its EPS is projected to land in at $1.58, and its revenue is estimated to hit $158.4 billion.

Furthermore, unlike its rival Target, since the beginning of the year and as of the time of the writing, Walmart has risen 15.7% and it will be interesting to see if this growth will continue in the months to come especially as the holiday shopping season, Black Friday and Cyber Monday kick-off. 

Walmart Price Chart on 13/11/2023

Evidently, Walmart is poised to provide customers with “incredible value with the best savings during the holiday season.” Accordingly, all of these events can shift the trajectory of this retail giant.  (Source: Nasdaq)

Conclusion

As the holiday shopping season approaches, upcoming earnings reports from major retailers, Home Depot, Target, and Walmart, can offer a much-needed glimpse into the economic landscape and consumer spending habits. 

While the results are yet to be determined, some analysts' projections suggest that Home Depot may face earnings declines attributed to higher rates and weakened demand, Target may grapple with bearish expectations amid consumer slowdown, while Walmart's Q3 projections may suggest a more resilient performance.


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