Walmart (NYSE:WMT) — the world’s largest retailer — is set to report earnings Thursday, Nov. 15, before the opening bell and believe it or not, there is some pessimism aimed at WMT stock ahead of earnings.

WMT is expected to report earnings-per-share of $1.02 for the third quarter of its fiscal 2019. Analysts expect the company to show revenue of $124.8 billion.

During the same period one year ago, Walmart earned $1 per share. Over the last three years, the company’s earnings have declined by an average of 1% per year. There was some good news from the second-quarter report as earnings grew by 46% over the previous year. WMT stock analysts expect the company to increase earnings by 8% for the year as a whole.

Sales have grown by a rate of 2% per year over the last three years and they were up by 4% in the second quarter. Analysts expect the sales results for the third quarter to show growth of 1.8% and growth of 3.1% for the year.

On the other hand, Walmart’s profitability measurements are somewhat mixed. The return on equity is at 16.6%, which is average and might be slightly above average. The profit margin is only 4.1% and the operating margin is only 4.3%. These two measurements are below average.

WMT Stock Has Been Performing Better Than the Company

Over the past year, the Walmart stock price has gained almost 20%. According to the Investor’s Business Daily Relative Strength rating, that puts Walmart stock in the top 12% of all stocks in the database during the period. The S&P 500 is only up 7.6% over the past year.

Looking at the weekly chart, we see that WMT stock has rallied sharply since May and that is where the outperformance has really occurred. During the market decline in September and October, the S&P lost just shy of 10%, while WMT stock was up over 4% during that stretch.

The Walmart stock chart is approaching its all-time high of $108.02, which was hit in January. We also see from the chart that Walmart stock is in overbought territory based on the 10-week RSI and the weekly stochastic readings.

In addition to the rally over the last six months, WMT stock has been trending higher since the end of 2015. There is a trendline that connects the lows over the last few years and that trendline is just below the $90 level currently. If we should see a pullback after earnings, that trendline could potentially act as support for WMT stock.

Sentiment Is Neutral Ahead of the WMT Earnings Report

Looking at the sentiment indicators, the overall sentiment toward Walmart stock is what I would consider neutral. There are 32 analysts following the stock and 15 have it rated as a “buy”. There are also 15 “hold” ratings and two “sell” ratings. Given the average fundamentals and the above average technical performance, this might be a slightly bearish skew toward the Walmart stock price from analysts.

Meanwhile, the short interest ratio is currently at 2.79 and that is in the average range. However, the number of shares sold short did jump by a million shares from the mid-October report through the end of October.

Looking at the options market, there are 236,305 puts open at this time and 320,342 calls. This puts the put/call ratio at 0.74 and like the short interest ratio, it is an average reading. When WMT reported earnings back on Aug. 16, the put/call ratio was at 0.73.

The reactions to the last four earnings reports for Walmart have been all over the board. There were two instances where WMT stock shot higher, one where WMT stock shot lower, and one where it opened slightly higher, but then dropped throughout the trading day.

Given all of the information — the average fundamentals, the technical strength and the neutral sentiment — I wouldn’t do anything with Walmart stock ahead of earnings. If you own it already, hang on to it. If you don’t own it, but want to own it, I don’t think it is necessary to buy ahead of the earnings report.

There are too many mixed signals on the Walmart stock price to make a bold play ahead of the report in my opinion.

As of this writing, Rick Pendergraft did not hold a position in any of the aforementioned securities.