Yahoo Finance Walmart Scales New Highs on Solid Q1 Earnings: ETFs to Buy
Before the opening bell yesterday, Walmart WMT reported robust first-quarter fiscal 2025 results, wherein it surpassed both earnings and revenue estimates. The megaretailer offered upbeat guidance for the fiscal year, spreading huge optimism and signaling a resilient consumer environment.
This pushed WMT shares to a record high. Investors seeking to tap the opportune moment should consider ETFs having the highest allocation to the world's largest brick-and-mortar retailers. These include Consumer Staples Select Sector SPDR Fund XLP, Vanguard Consumer Staples ETF VDC, Fidelity MSCI Consumer Staples Index ETF FSTA, VanEck Vectors Retail ETF RTH and iShares Evolved U.S. Discretionary Spending ETF IEDI.
Walmart’s Earnings in Focus
Earnings per share came in at 60 cents, outpacing the Zacks Consensus Estimate of 52 cents and improving from the year-ago earnings of 49 cents. Revenues rose 6% year over year to $161.5 billion and topped the consensus mark of $159.50 billion. U.S. comparable sales grew 3.8%. Notably, e-commerce sales surged 21%, led by store-fulfilled pickup & delivery and marketplace.
The retailer achieved a record-high member count and plus members, resulting in membership income growth of more than 13% (read:Inflation Cools in April: 5 Sector ETFs & Stocks to Thrive).
The mega-retailer upped fiscal 2025 guidance. It now expects revenue growth to be at the high end or slightly above its previous guidance of 3-4% and earnings per share at the high end or slightly above the original guidance of $6.70-$7.12. For second-quarter fiscal 2025, Walmart expects sales to grow 3.5-4.5% and adjusted earnings per share in the range of 62-65 cents.
Below, we have detailed the ETFs:
Consumer Staples Select Sector SPDR Fund (XLP)
Consumer Staples Select Sector SPDR Fund targets the broad consumer staples space and follows the Consumer Staples Select Sector Index. It holds about 38 securities in its basket with Walmart taking the third spot at 9.6%. XLP has the largest allocation in consumer staples distribution & retail at 32%, while household products, beverages, and food products account for a double-digit allocation each. Consumer Staples Select Sector SPDR Fund is the most popular consumer staples ETF with AUM of $15.3 billion and an average daily volume of 12.6 million shares. XLP charges 12 bps in fees per year and has a Zacks ETF Rank #3 (Hold) with a Medium risk outlook (read: ETFs to Make the Most of the Sector Rotation).
Vanguard Consumer Staples ETF (VDC)
Vanguard Consumer Staples ETF also targets the broad consumer staples space by tracking the MSCI US Investable Market Consumer Staples 25/50 Index. It holds 103 stocks in its basket, with Walmart occupying the third position, having a 7.9% allocation. Vanguard Consumer Staples ETF manages a $6.7 billion asset base and charges a fee of 10 bps per year. VDC trades in a good average volume of around 96,000 shares per day and has a Zacks ETF Rank #3 with a Medium risk outlook.
Fidelity MSCI Consumer Staples Index ETF (FSTA)
Fidelity MSCI Consumer Staples Index ETF offers broad exposure to the consumer staples sector by tracking the MSCI USA IMI Consumer Staples Index and holds 107 stocks in its basket. Of these, Walmart takes the third spot with an 8% share. Fidelity MSCI Consumer Staples Index ETF has amassed $1.1 billion in its asset base while trading in a good volume of around 70,000 shares a day, on average. FSTA charges 8 bps in annual fees from investors and has a Zacks ETF Rank #3 with a Medium risk outlook (see: all Consumer Staples ETFs here).
VanEck Vectors Retail ETF (RTH)
VanEck Vectors Retail ETF provides exposure to the 26 largest retail firms by tracking the MVIS US Listed Retail 25 Index, which measures the performance of the companies involved in retail distribution, wholesalers, online, direct mail and TV retailers, multi-line retailers, specialty retailers and food and other staples retailers. Walmart takes the fourth spot with a 7.3% share. VanEck Vectors Retail ETF has amassed $206.7 million in its asset base and charges 35 bps in annual fees. It trades in a lower volume of 6,000 shares a day on average. VanEck Vectors Retail ETF has a Zacks ETF Rank #2 (Buy) with a Medium risk outlook.
iShares U.S. Consumer Focused ETF (IEDI)
iShares U.S. Consumer Focused ETF is an actively managed ETF providing exposure to U.S. companies with a focus on U.S. consumer spending and consumer goods. It holds 205 stocks in its basket, with Walmart occupying the fourth position at 5.5% share. iShares U.S. Consumer Focused ETF has accumulated $21.6 million in its asset base and charges 18 bps in fees per year. Volume is paltry for IEDI as it exchanges 13,000 shares a day, on average.
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Walmart Inc. (WMT) : Free Stock Analysis Report
Consumer Staples Select Sector SPDR ETF (XLP): ETF Research Reports
VanEck Retail ETF (RTH): ETF Research Reports
Vanguard Consumer Staples ETF (VDC): ETF Research Reports
Fidelity MSCI Consumer Staples Index ETF (FSTA): ETF Research Reports
iShares U.S. Consumer Focused ETF (IEDI): ETF Research Reports
