NEW YORK, August 21, 2026, 08:25 EDT — Activity in U.S. premarket hours picked up ahead of trading on Friday.
- Walmart declined 9.15%, wiping out around $83.2 billion in market capitalisation.
- Refunds from tariffs accounted for about 43% of the rise in adjusted operating income.
- U.S. same-store sales increased by 2.6%, below the expected 3.7% rise.
Walmart Inc. NASDAQ:WMT saw its market value drop by approximately $83.2 billion on Thursday, as shares declined 9.15% to $103.84. This drop followed an earnings beat and an upward revision of its annual guidance.
The decline revealed a disparity in the underlying quality of profit gains. Walmart booked almost $2.9 billion in tariff reimbursements. According to management, these refunds contributed 750 basis points to its 17.4% adjusted operating income growth at constant currency. This accounts for roughly 43% of the total growth reported.
Sales held steady across the board. Revenue increased by 5.9% to $187.9 billion. Adjusted earnings stood at $0.81 per share. Both results exceeded the consensus projections reported by Yahoo Finance.
| Q2 FY27 scorecard | Reported | Comparison | Investor read |
|---|---|---|---|
| Total revenue | $187.9bn | $186bn estimate | Above expectations |
| Adjusted EPS | $0.81 | $0.74 estimate | Better than forecast |
| Walmart U.S. comp sales | +2.6% | +3.7% estimate | Below estimate |
| Global e-commerce | +23% | +22% estimate | Above projection |
| Operating income | +28.8% | +17.4% adjusted, constant currency | Boosted by refunds |
| Net income attributable to Walmart | $6.37bn | -9.4% year on year | Decreased |
U.S. comparable sales emerged as the weak spot, increasing 2.6%, the slowest pace since late 2020. Pharmacy price controls created a 125-basis-point drag on the category, while fuel prices above $4 led shoppers to make trade-offs. Core merchandise comparable sales still managed only a 3.4% gain.
John David Rainey, Walmart’s Chief Financial Officer, said in June that such trade-offs grew “a little more obvious.” The retailer enacted over 11,000 price rollbacks in the U.S. Some of the gains from tax refunds were countered by increased fuel expenses and ongoing price investment. Yahoo Finance
Digital expansion continues to provide significant support. Worldwide e-commerce increased by 23%. Walmart U.S. e-commerce saw a 24% rise, and global advertising advanced by 38%. Revenue from membership fees was up 17%. These faster-growing segments enhance the sales mix, though they were not enough to avert a recalibration of comp-sales.
| Guidance | Original FY27 | Current FY27 | Market context |
|---|---|---|---|
| Net sales growth | 3.5%–4.5% | 4.0%–5.0% | Consensus about 5% |
| Adjusted operating-income growth | 6.0%–8.0% | 7.0%–8.5% | Increased |
| Adjusted EPS | $2.75–$2.85 | $2.80–$2.87 | Consensus was $2.97 |
| Q3 net sales growth | — | 3.0%–3.75% | Flipkart timing impact |
| Q3 adjusted EPS | — | $0.62–$0.64 | Updated outlook |
The higher range did not eliminate a valuation issue. The $2.835 midpoint is roughly 4.5% under the earlier $2.97 consensus. Rainey advised investors to “consider Q2 and Q3 performance together” since refunds obtained in Q2 are intended to support pricing initiatives in the second half. Walmart
| Retail valuation at Aug. 20 close | Price | Day move | Market cap | Trailing P/E |
|---|---|---|---|---|
| Walmart NASDAQ:WMT | $103.84 | down 9.15% | $826.37bn | 40.25x |
| Costco Wholesale NASDAQ:COST | $933.51 | down 2.45% | $413.99bn | 46.96x |
| Target NYSE:TGT | $158.25 | down 0.47% | $71.88bn | 16.50x |
Despite Thursday’s drop, Walmart shares were valued at 40.25 times trailing earnings. This figure remains near Costco’s 46.96 multiple and is significantly higher than Target’s 16.50. Investors continue to pay a significant premium for Walmart’s scale and defensive qualities.
| Analyst opinion | Date | Action | Price target |
|---|---|---|---|
| Gordon Haskett | Aug. 20 | Accumulate, downgraded from Buy | Not disclosed |
| Oppenheimer / Rupesh Parikh | Aug. 19 | Cautious, downgraded from Market Perform | Not disclosed |
| Guggenheim / John Heinbockel | Aug. 17 | Buy | $135 |
| DA Davidson / Michael Baker | Aug. 17 | Buy | $150 |
| 38-analyst view | Aug. 21 review | Moderate Buy | $137.44 |
Analysts continue to support the long-term outlook, with the consensus target holding at $137.44. However, two recent downgrades indicate reduced patience for a premium valuation in the face of a slowdown in the U.S. comparable sales engine.
Risks: Comparable sales may be pressured by shifts in fuel costs, pharmacy oversight, tariffs, and consumer downgrading. Margins can be skewed by the timing of refunds. Quicker expansion in e-commerce and advertising might suggest the scale of the selloff is overstated.
The upcoming test focuses on third-quarter margin quality. Investors are watching for core operating income to come close to the 7%–10% range in the absence of a further refund benefit. Failing that, Walmart’s premium may remain at risk.
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