24/7 Wall St.

The home of "everyday low prices" took a bit of a hit today when it put out its earnings. It can not longer be called "recession proof", but it is still damn close.

Wal-Mart (WMT) made a very modest adjustment to its guidance. The world’s largest retailer said "For the full year, ending January 31, we have tightened and modestly reduced our guidance and now forecast diluted earnings per share from continuing operations to be within a range of $3.42 to $3.46." Wall St. expected that number to be $3.49. Not much of a miss. Not in this economic environment.

What won’t end up in the headlines is how well Wal-Mart did in the last quarter. Net sales for the third quarter of fiscal year 2009 were $97.6 billion, an increase of 7.5% from $90.8 billion in the third quarter last year. The is an astonishingly good number for such a large company to post in an economic downturn.

Income from continuing operations for the third quarter was $3.033 billion, an increase of 6.6% from $2.846 billion in the third quarter last year. Diluted earnings per share from continuing operations for the third quarter of fiscal year 2009 increased to $0.77 from the previous year’s third quarter result of $0.70 per share.

A look at numbers from large retailers including Best Buy (BBY), Gap (GPS) Macy’s (M) who hit a wall last quarter show just how good the Wal-Mart number are. While WMT international revenue did well, up 11.2% to $61.1 billion, it was the US which posted the more surprising numbers with an over 6% improvement at Wal-Mart and a nearly 8% improvement at Sam’s Club.

Because Wal-Mart is huge, its exposure to the economy should be as well. That it can market itself as the only reasonable place to shop in a recession and get consumers to buy into that is amazing.

Douglas A. McIntyre