Walmart Raises FY2026 EPS Guidance to $2.58-$2.63
Walmartis scheduled to report results of its fourth quarter before the market open on Thursday, February 19, with a conference call scheduled for 8:00 am EDT. What to watch for:GUIDANCE:After stating that it was "well-positioned" for a strong finish to the year and beyond, Walmart raised its adjusted earnings per share view for fiscal 2026 to $2.58-$2.63 from $2.52-$2.62 and its revenue view to up 4.8%-5.1% from up 3.75%-4.75%. Analysts currently expect EPS of $2.64 on revenue of $706.35B. Earlier in February, Walmart's market capitalization surpassed $1T, joining a small group of mega-cap U.S. companies typically dominated by technology firms. The milestone followed a two-year rally in which Walmart shares have more than doubled, significantly outperforming the S&P 500.UBS said it believes Walmart will generate a Q4 beat and provide an achievable set of initial targets, which should set it up well for another beat and raise cycle. Wells Fargo expects a solid Q4 with 4.5%-plus U.S. same-stores sales and a slight EPS beat. The 2026 outlook is tricky given historical conservatism, but investors expect initial guide below Street, the firm said.DA Davidson keeps a Buy rating and $135 price target on Walmart ahead of the company's Q4 earnings call - the first under CEO John Furner. Most expect the message to be "business as usual" - continued market share gains, comps in the 4%-5% range, and continued margin expansion driven by strength in Walmart's "Triple A" investment initiatives around Alternative business, AI/Agentic commerce, and Automation, the analyst tells investors in a research note. 2026 guidance may be below consensus, but that's not overly concerning as the company tends to beat the original plans, the firm adds.POSITIONED FOR POTENTIAL DIP:Ahead of Walmart's earnings report, Oppenheimer lifted its Q4 EPS estimate toward the high end of management's guidance range reflecting expectations for a strong holiday season, top-line momentum across the enterprise, and potentially some modest weather benefits. Regarding initial fiacal year guidance, Oppenheimer still expects management to "only" guide consistent with the company's algorithm for 4% sales growth and 4%-8% operating income growth. This is below the current Street figure for 11.3% operating growth. As a result, the firm still would be positioned for any potential dip vs. playing for a positive catalyst. Walmart remains a top pick at Oppenheimer.DIGITAL OPPORTUNITIES:Rothschild & Co Redburn sees Walmart's digital opportunities driving 14% annual earnings growth through 2028. The company has "multiple levers" to deliver this growth while its AI opportunities can driving incremental upside, the analyst tells investors in a research note.KeyBanc believes Walmart is one of the best positioned to navigate the current environment. Economic data remains mixed with tailwinds from lower mortgage/interest rates, improved housing data, and job growth, but headwinds remain from low consumer confidence and a higher cost of living, KeyBanc points out. Looking ahead, the firm sees a potential positive catalyst to spending from higher tax refunds and easier monetary policy, which should accelerate spending in the months ahead. Meanwhile, Goldman said that Walmart could see a sales lift from its partnerships with Googleand OpenAI given their large user bases and ability to serve customers on new occasions which do not begin with commercial intent.AFFORDABILITY:BTIG told investors that over the last several years, as Walmart has gained share, the company has experienced retention of its share gains at the highest level in the company's long history, and the firm expects this momentum to be sustained, the analyst tells investors in a research note. Although no company is completely immune to economic factors, Walmart and Sam's Club continue to attract consumers seeking affordability, BTIG added.SENTIMENT:to check out recent Media Buzz Sentiment on Walmart as measured by TipRanks.
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U.S. Retailers Stock Up on Chinese Goods Ahead of Potential Tariffs
- Preemptive Stocking Strategy: U.S. retailers are placing orders for Chinese goods four to six weeks earlier than usual due to anticipated higher import tariffs this summer, indicating a proactive approach to uncertain tariff policies and holiday sales preparation.
- Tariff Policy Changes: Following the Supreme Court's ruling that Trump lacked authority to impose tariffs, the White House implemented a universal 10% tariff under Section 122 of the 1974 Trade Act, which is set to expire on July 24 but may increase to 12.5%, directly impacting import costs.
- Surge in Orders: Recent orders to overseas manufacturers have surged compared to the typical increase seen from July to September, reflecting retailers' urgency to meet holiday demand, particularly in categories like electronics, furniture, and household appliances.
- Economic Impact Analysis: While this trend temporarily boosts China's economy, with Q1 GDP growth at 5.0% exceeding expectations, the second quarter is projected to slow to 4.0%-4.5%, indicating challenges to the sustainability of economic growth.
Target's Stock Surge Outpaces Walmart Amidst Economic Challenges
- Stock Rebound: Target's stock has surged approximately 33% this year, while Walmart has only risen by 2%, indicating a renewed investor confidence in Target, which may reflect optimistic market expectations for its future growth.
- Sales Growth Challenges: Despite reporting net sales of $25.4 billion in the latest quarter, a nearly 7% year-over-year increase, this figure is nearly unchanged from $25.3 billion three years ago, highlighting instability in its growth trajectory and future challenges.
- Valuation Appeal: Target's price-to-earnings ratio stands at 17 times, significantly lower than Walmart's 40 times, suggesting that its lower valuation may be a key reason for its superior performance relative to competitors this year, attracting value-seeking investors.
- Long-Term Outlook: Although the growth rate may not be as impressive in upcoming quarters, as economic conditions improve, Target is expected to regain stronger performance, making it a worthwhile investment strategy to consider holding for the long term.
Target's Stock Surge: Analyzing the Reasons Behind the Growth
- Performance Recovery: Target's net sales reached $25.4 billion in the most recent quarter, reflecting a nearly 7% year-over-year growth, indicating a potential turnaround after several periods of declining sales, which may attract investor interest.
- Significant Valuation Advantage: With a price-to-earnings ratio of only 17 compared to Walmart's 40, this stark valuation difference positions Target as a more appealing investment choice, particularly in a challenging economic environment.
- Management Change Impact: The appointment of new CEO Michael Fiddelke may bring renewed hope for the company, and while management changes typically do not resolve fundamental issues quickly, market expectations for improved performance could drive stock price increases.
- Long-Term Investment Potential: Although Target's growth rate may not be as robust in the coming quarters, the company's long-term growth potential remains noteworthy, especially as economic conditions improve, potentially offering investors a solid holding opportunity.
Analysis of Three Major High Dividend ETFs
- Strong Performance of SCHD: As of June 26, 2026, the Schwab U.S. Dividend Equity ETF (SCHD) has risen over 15%, significantly outperforming the S&P 500, Nasdaq Composite, and Dow Jones, indicating its robust market performance and investment appeal.
- Diversification Advantage of VYM: The Vanguard High Dividend Yield ETF (VYM) offers a respectable 2.3% yield with 605 holdings, providing good diversification opportunities, and has doubled its dividend payout over the past decade, enhancing investor confidence.
- Growth Potential of VIG: The Vanguard Dividend Appreciation ETF (VIG) has the lowest dividend yield among the three but boasts a total return of 251% over the past decade, far exceeding SCHD and VYM, showcasing its unique advantage in growth stocks with a 28.4% allocation to tech.
- Cautious Investment Advice: Despite SCHD's strong performance, it was not included in the Motley Fool's current best stock picks, suggesting that investors should be cautious and consider potential higher return opportunities when selecting high dividend ETFs.
Stable Passive Income Source: High Dividend ETFs
- Strong ETF Performance: The Schwab U.S. Dividend Equity ETF (SCHD) has shown remarkable performance in early 2026, rising over 15% and significantly outperforming the S&P 500, Nasdaq, and Dow Jones, highlighting its leadership in high-quality dividend stocks.
- Stable Dividend Yield: With a dividend yield of 3.3%, SCHD offers the highest yield among the three ETFs, and its stringent selection criteria ensure companies have a track record of 10 consecutive years of dividend increases, providing reliable passive income for long-term investors.
- Diversified Investment Options: The Vanguard High Dividend Yield ETF (VYM) offers a respectable 2.3% yield with a diversified portfolio of 605 stocks, and its dividend payouts have more than doubled over the past decade, appealing to investors seeking stable income.
- Growth Potential with Dividends: The Vanguard Dividend Appreciation ETF (VIG) has the lowest yield but boasts a total return of 251% over the past decade, far exceeding SCHD and VYM, showcasing its strength in growth stocks and appealing to investors looking for capital appreciation.
Rising Recession Risks for 2027 Amid Economic Turmoil
- Recession Probability: A J.P. Morgan study indicates a 35% chance of a global recession in 2026, with ongoing concerns about the Middle East and U.S. inflation, prompting investors to prepare for potential economic downturns.
- Kroger's Strong Performance: Kroger reported Q1 2026 revenue of $46.1 billion, up 2.2% year-over-year, with a notable 19% increase in e-commerce sales, demonstrating resilience during economic downturns, while offering a 2.5% dividend yield that attracts investors.
- UnitedHealth Group's Recovery: UnitedHealth Group's Q1 revenue reached $111.7 billion, a 2% increase from last year, and raised its full-year EPS outlook to $17.35, reflecting strong performance in the healthcare insurance market, with a dividend yield of 2.13%.
- WM's Steady Growth: WM's Q1 revenue was $6.22 billion, up 3.5% year-over-year, with EPS rising to $1.79, showcasing the stability of its waste management business amid economic fluctuations, and offering a dividend yield of 1.58%.
U.S. Retailers Stock Up on Chinese Goods Ahead of Potential Tariffs
- Preemptive Stocking Strategy: U.S. retailers are placing orders for Chinese goods four to six weeks earlier than usual due to anticipated higher import tariffs this summer, indicating a proactive approach to uncertain tariff policies and holiday sales preparation.
- Tariff Policy Changes: Following the Supreme Court's ruling that Trump lacked authority to impose tariffs, the White House implemented a universal 10% tariff under Section 122 of the 1974 Trade Act, which is set to expire on July 24 but may increase to 12.5%, directly impacting import costs.
- Surge in Orders: Recent orders to overseas manufacturers have surged compared to the typical increase seen from July to September, reflecting retailers' urgency to meet holiday demand, particularly in categories like electronics, furniture, and household appliances.
- Economic Impact Analysis: While this trend temporarily boosts China's economy, with Q1 GDP growth at 5.0% exceeding expectations, the second quarter is projected to slow to 4.0%-4.5%, indicating challenges to the sustainability of economic growth.
Target's Stock Surge Outpaces Walmart Amidst Economic Challenges
- Stock Rebound: Target's stock has surged approximately 33% this year, while Walmart has only risen by 2%, indicating a renewed investor confidence in Target, which may reflect optimistic market expectations for its future growth.
- Sales Growth Challenges: Despite reporting net sales of $25.4 billion in the latest quarter, a nearly 7% year-over-year increase, this figure is nearly unchanged from $25.3 billion three years ago, highlighting instability in its growth trajectory and future challenges.
- Valuation Appeal: Target's price-to-earnings ratio stands at 17 times, significantly lower than Walmart's 40 times, suggesting that its lower valuation may be a key reason for its superior performance relative to competitors this year, attracting value-seeking investors.
- Long-Term Outlook: Although the growth rate may not be as impressive in upcoming quarters, as economic conditions improve, Target is expected to regain stronger performance, making it a worthwhile investment strategy to consider holding for the long term.
Target's Stock Surge: Analyzing the Reasons Behind the Growth
- Performance Recovery: Target's net sales reached $25.4 billion in the most recent quarter, reflecting a nearly 7% year-over-year growth, indicating a potential turnaround after several periods of declining sales, which may attract investor interest.
- Significant Valuation Advantage: With a price-to-earnings ratio of only 17 compared to Walmart's 40, this stark valuation difference positions Target as a more appealing investment choice, particularly in a challenging economic environment.
- Management Change Impact: The appointment of new CEO Michael Fiddelke may bring renewed hope for the company, and while management changes typically do not resolve fundamental issues quickly, market expectations for improved performance could drive stock price increases.
- Long-Term Investment Potential: Although Target's growth rate may not be as robust in the coming quarters, the company's long-term growth potential remains noteworthy, especially as economic conditions improve, potentially offering investors a solid holding opportunity.
Analysis of Three Major High Dividend ETFs
- Strong Performance of SCHD: As of June 26, 2026, the Schwab U.S. Dividend Equity ETF (SCHD) has risen over 15%, significantly outperforming the S&P 500, Nasdaq Composite, and Dow Jones, indicating its robust market performance and investment appeal.
- Diversification Advantage of VYM: The Vanguard High Dividend Yield ETF (VYM) offers a respectable 2.3% yield with 605 holdings, providing good diversification opportunities, and has doubled its dividend payout over the past decade, enhancing investor confidence.
- Growth Potential of VIG: The Vanguard Dividend Appreciation ETF (VIG) has the lowest dividend yield among the three but boasts a total return of 251% over the past decade, far exceeding SCHD and VYM, showcasing its unique advantage in growth stocks with a 28.4% allocation to tech.
- Cautious Investment Advice: Despite SCHD's strong performance, it was not included in the Motley Fool's current best stock picks, suggesting that investors should be cautious and consider potential higher return opportunities when selecting high dividend ETFs.
Stable Passive Income Source: High Dividend ETFs
- Strong ETF Performance: The Schwab U.S. Dividend Equity ETF (SCHD) has shown remarkable performance in early 2026, rising over 15% and significantly outperforming the S&P 500, Nasdaq, and Dow Jones, highlighting its leadership in high-quality dividend stocks.
- Stable Dividend Yield: With a dividend yield of 3.3%, SCHD offers the highest yield among the three ETFs, and its stringent selection criteria ensure companies have a track record of 10 consecutive years of dividend increases, providing reliable passive income for long-term investors.
- Diversified Investment Options: The Vanguard High Dividend Yield ETF (VYM) offers a respectable 2.3% yield with a diversified portfolio of 605 stocks, and its dividend payouts have more than doubled over the past decade, appealing to investors seeking stable income.
- Growth Potential with Dividends: The Vanguard Dividend Appreciation ETF (VIG) has the lowest yield but boasts a total return of 251% over the past decade, far exceeding SCHD and VYM, showcasing its strength in growth stocks and appealing to investors looking for capital appreciation.
Rising Recession Risks for 2027 Amid Economic Turmoil
- Recession Probability: A J.P. Morgan study indicates a 35% chance of a global recession in 2026, with ongoing concerns about the Middle East and U.S. inflation, prompting investors to prepare for potential economic downturns.
- Kroger's Strong Performance: Kroger reported Q1 2026 revenue of $46.1 billion, up 2.2% year-over-year, with a notable 19% increase in e-commerce sales, demonstrating resilience during economic downturns, while offering a 2.5% dividend yield that attracts investors.
- UnitedHealth Group's Recovery: UnitedHealth Group's Q1 revenue reached $111.7 billion, a 2% increase from last year, and raised its full-year EPS outlook to $17.35, reflecting strong performance in the healthcare insurance market, with a dividend yield of 2.13%.
- WM's Steady Growth: WM's Q1 revenue was $6.22 billion, up 3.5% year-over-year, with EPS rising to $1.79, showcasing the stability of its waste management business amid economic fluctuations, and offering a dividend yield of 1.58%.
