Jefferies: Wal-Mart Saw Good Holiday Sales, Lower Gas Prices To Help

Daniel Binder of Jefferies commented in a note on Wednesday that

likely saw good holiday sales and that its momentum will likely continue in the near-term. “Despite some bottlenecks due to port issues, we think the company saw good Holiday results based on our field research,” Binder wrote. “Wal-Mart likely benefited from an improving macro backdrop, lower oil prices and better weather.” As a result of a positive holiday season, Binder is raising his fourth quarter earnings per share estimate to $1.57 from a previous $1.55. The analyst adds that enthusiasm around lower gas prices may continue even with nominal EPS growth expected in the near-term. Looking forward to fiscal 2016, Binder notes that better-than-expected same-store sales could be seen as long as lower gas prices are likely to remain in the foreseeable future. However, the company may see “modest” operating margin pressures as the company focuses on growing its e-commerce business. Also, International will continue to underperform as the company struggles with difficult economies and turnaround efforts. Shares are Hold rated with an $82 price target.