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Wal-Mart (WMT) Shares Off After Downbeat Earnings Forecast

 November 15, 2012 07:25 AM

(By Balachander) Wal-Mart Stores Inc. (NYSE: WMT) shares fell 1.72 percent in premarket trading on Thursday after the world's largest retail chain store operator offered downbeat guidance for the fourth quarter following higher third-quarter earnings.

Earnings per share from continuing operations attributable to Walmart (EPS) were $1.08, up 11.3 percent for the third quarter.

Net sales grew 3.4 percent to $113.2 billion. Excluding currency impact, net sales would have increased 4.9 percent, the company said.

Wall Street analysts, on average, expected earnings of $1.07 per share on sales growth of 4.30 percent to $114.95 billion.

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Total U.S. comparable store sales rose 1.7 percent. Comparable sales from Walmart U.S. increased 1.5 percent with positive ticket and traffic. Sam's Club comps gained 2.7 percent.

Walmart U.S. sales gained 3.6 percent and International sales grew 2.4 percent. Sam's Club sales rose 4.7 percent.

Looking ahead for the fourth quarter, the company expects earnings from continuing operations of $1.53 to $1.58 per share, while Wall Street analysts expect $1.59 per share.

For the full year, the company narrowed its earnings outlook by 5 cents to $4.88 to $4.93 from prior expectations of $4.83 to $4.93, while consensus estimate $4.94 a share.

For the 4-5-4 period from Oct. 27, 2012 through Jan. 25, 2013, Walmart U.S. expects comp store sales to range from 1.0 percent to 3.0 percent.

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"November sales started ahead of plan. Our Black Friday plans are innovative and designed to drive additional traffic in our stores," commented Bill Simon, Walmart U.S. president and chief executive officer. "We expect strong performance through Thanksgiving weekend."

WMT closed Wednesday's regular session at $71.31. The stock has been trading between $56.26 and $77.60 for the past 52 weeks.

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