Michael Lasser Impressed By Wal-Mart's Q1 Beat, But Isn't Ready To Buy The Stock

Wal-Mart Stores, Inc. WMT impressed investors and traders with its better-than-expected first quarter results. But did the company also impress some of Wall Street's top retailing analysts?

Speaking as a guest on CNBC, UBS' Michael Lasser said he was looking for Wal-Mart to report a 0.5 percent comp gain. However, the company reported a 1 percent gain which was impressive considering the "broader retail environment" and "some of the questions about the consumer."

"Wal-Mart did a pretty good job in the quarter," the analyst continued. "I think that speaks to the consistency of the business... to the consumable nature of the business and the geographic distribution."

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However, Lasser questioned if Wal-Mart can sustain margins over the longer-term.

When asked what would it take for Lasser to upgrade Wal-Mart's stock rating from Neutral to Buy, the analyst suggested that there is a "mis-match" between the company's U.S. sales which rose 4 percent while operating income fell 8 percent.

"What we need to see is that they can grow sales and earnings over time," he said. "Right now, they are investing in the business - in labor and prices to drive the long-term."

He concluded it might take several quarters before "we see any evidence" that Wal-Mart's initiatives are "working."