U.S. markets ended a relatively quiet day right near their starting point, as several big-name retailers reported strong earnings, contradicting some recent poor reports by retailers, demonstrating that consumers are still willing to spend money in this economy.
In addition, the markets were following the price of crude oil, which meandered quite a bit during the day, before finally finishing down 2% on oversupply concerns.
In economic news, October’s consumer price index (CPI) was up 0.2%, in line with analysts’ estimates. However, the National Association of Home Builder’s/Wells Fargo Market index was down more than expected in November, coming in at a confidence reading of 62. The street was looking for 63. Still, any number above 50 is considered positive.
All told, the S&P 500 was down 0.1%, and the Dow Jones Industrial Average and Nasdaq were flat. Sectors were mostly in the red, with healthcare the strongest and utilities the weakest.
Despite the mixed market, it was a solid day for several retail stocks, including Wal-Mart Stores, Inc. (NYSE:WMT), Home Depot Inc (NYSE:HD) and TJX Companies Inc (NYSE:TJX), which are three of today’s best stocks after posting better-than-expected earnings.
Wal-Mart Stores, Inc. (WMT)
WMT stock was trading more than 3% higher today after the No. 1 retailer in the U.S. reported diluted earnings of $1.03 per share, ahead of the analysts’ consensus for 98 cents per share. Revenue of $117.41 billion was just a tad below street estimates for $117.79 billion.
Walmart tightened its forecast for full year EPS from a range of $4.40 – $4.70, to a new range of $4.50 – $4.65. During this quarter, WMT paid out $1.6 billion in dividends, while repurchasing almost 6 million shares for a total of $437 million.
WMT stock has been in the doldrums in recent months, falling from $74 per share in early August to a recent low near $57. At the current price, the dividend yield is now about 3.3%.
Home Depot Inc (HD)
HD stock was up over 4% today, after the home improvement giant reported third-quarter earnings of $1.35 per share, ahead of Wall Street’s estimates by 4 cents. The company also forecast full-year earnings of $5.36 per share, which was 5 cents better than analysts’ estimates.
Third-quarter revenue was $21.82 billion, up from $20.52 billion a year ago, and in line with Wall Street’s view.
A strong real estate market was cited as one of the reasons for Home Depot’s solid quarter, with a high percentage of sales coming from contractors and consumers doing remodeling work to get their homes ready for sale.
TJX Companies Inc (TJX)
Completing a trio of good earnings reports today was TJX, which owns T.J. Maxx, Marshalls, and HomeGoods. TJX reported third-quarter earnings of 86 cents per share on revenue of $7.75 billion. Both numbers were better than the analysts’ expectations for 84 cents per share on $7.73 billion revenue. Same-store sales rose 5% year-over-year.
TJX stock was up nearly 4%.
CEO Carol Meyrowitz expressed unabashed faith in her company, saying, “I am very confident we will grow TJX to a $40 billion-plus company!”
As of this writing, Ethan Roberts does not hold a position in any of the aforementioned securities.
