Walmart Offers 2013/2014 Guidance

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Wal-Mart Stores Inc. (NYSE: WMT) outlined many of its plans for 2013 and beyond at today’s annual meeting for shareholders. The company has also now issued secondary data that includes preliminary guidance for the next year. The retail giant sees capital spending next year at $12.0 to $13.0 billion. This is lower than what is expected for the current year even though it projects 36 to 40 million retail square feet added next year.

Walmart claims to be on track to achieve its five-year commitment of reducing operating expenses as a percentage of sales by 100 basis points from fiscal years 2013 through 2017. The retailer plans to lower its fiscal 2014 capital plan from fiscal 2013 while growing a a balance of its smaller format stores with supercenters. Walmart reaffirmed its most recent cap-ex guidance of $12.6 to $13.5 billion for the current year and $12.0 to $13.0 billion next year.

Walmart International’s capital plan is relatively flat at $4.5 to $5.0 billion, delivering growth of 20 to 22 million square feet next fiscal year.

The company provided guidance of 5% to 7% percent sales growth or by $23.0 to $33.0 billion next year (again fiscal 2014) with 3% to 4% retail square footage growth for next fiscal year, but it sees operating expense growth less than the rate of sales growth. Walmart is expected to post revenues of $471.9 billion for the current year, so that implies sales in a range of $501 billion to $511 billion. Thomson Reuters has estimates of $495.4 billion.

Walmart shares are up almost 2% at $75.50 but the stock hit a new 52-week high of $76.81 today. The prior 52-week trading range was $54.48 to $75.55 and Thomson Reuters has a consensus price target of $77.53 for one year out.

JON C. OGG

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