To The Moon

$Wal-Mart(WMT)$ is scheduled to report its fiscal fourth-quarter 2026 earnings on Thursday, February 19, 2026, before the market opens.

Coming off a massive rally—up over 20% year-to-date and recently crossing the $1 trillion market cap milestone—the stakes are exceptionally high. The market has priced in near-perfection, leaving little room for error.

Q4 2026 Forecast & Estimates

Analysts are expecting a strong holiday quarter, driven by e-commerce momentum and market share gains among higher-income households.

Walmart (WMT) reported its fiscal Q3 2026 earnings on November 20, 2025, delivering a "beat and raise" quarter that further cemented its lead in the retail sector.

Q3 2026 Financial Summary

Walmart exceeded expectations across all primary financial metrics, driven by a surge in digital sales and an influx of higher-income shoppers.

Total Revenue: $179.5 billion, up 5.8% (6.0% in constant currency), beating estimates of ~$177.1 billion.

Adjusted EPS: $0.62, outperforming the consensus estimate of $0.60.

U.S. Comparable Sales: +4.5% (excluding fuel), significantly higher than the 3.8% projected by analysts.

E-commerce Momentum: Global e-commerce sales jumped 27%, with U.S. digital sales alone rising 28% as store-fulfilled delivery and "expedited" (under 3-hour) shipping accelerated.

Profitability Mix: Global advertising revenue (Walmart Connect) grew 53%, and membership income rose 17%, helping to scale margins.

The Lesson from Q3 Guidance

The most critical takeaway from the Q3 report wasn't just the "beat," but the structural confidence in management's revised full-year 2026 outlook.

The Key Lessons Learnt:

1. Walmart is no longer just a "Discounter": Management highlighted that share gains are coming increasingly from households earning >$100k. The lesson for investors is that Walmart’s investment in convenience (pickup/delivery) has successfully rebranded the company as a "premium-utility" retailer, not just a place for low-income shoppers.

2. The "Flywheel" is actually working: For years, Walmart talked about its "flywheel"—using retail to fuel high-margin advertising and memberships. The Q3 data proved this is now at scale. Advertising grew 10x faster than retail sales, which allows Walmart to keep prices low while still increasing profit.

3. Efficiency over Inflation: Despite concerns over potential tariffs and wage inflation, the guidance hike suggests that automation (60% of stores now receive automated freight) is providing a sufficient "buffer" to protect earnings.

4. Nasdaq Switch & AI Pivot: During the Q3 call, the company announced its move to the Nasdaq (effective Dec 9, 2024), signaling its intent to be viewed as an AI-driven tech-retailer rather than a legacy brick-and-mortar company.

Key Metrics to Watch

Beyond the headline numbers, investors will focus on three specific areas to justify the stock’s premium valuation (Forward P/E of ~45x):

• Higher-Income Retention: Walmart has recently gained significant share from households earning over $100k. Investors want to see if this is a permanent structural shift or just a temporary "trade-down" due to inflation.

• High-Margin Services: Keep a close eye on Walmart Connect (Advertising) and Membership Income (Walmart+ / Sam's Club). These segments are growing faster than retail sales and are critical for overall margin expansion.

• AI and Automation Efficiency: Management previously stated that 60% of stores are now serviced by automated distribution centers. Look for updates on "cost to serve" reductions and how AI is impacting operating margins.

• FY2027 Guidance: This is the "make-or-break" component. The Street expects roughly 11% operating income growth for next year; if management guides more conservatively (their historical 4-8% range), the stock could see a "sell the news" reaction.

Wal-Mart (WMT) Price Target

Based on 40 analysts from Tiger Brokers app offering 12 month price targets for Walmart in the last 3 months. The average price target is $128.53 with a high forecast of $150.00 and a low forecast of $69.10. The average price target represents a -0.25% change from the last price of $128.85.

Short-Term Trading Opportunities

The options market is currently implying a +/- 5.4% move ($7.28 per share) following the release.

The Bull Case (The "Beat and Raise")

If Walmart beats on EPS and provides FY2027 guidance that aligns with the Street's aggressive 11% targets, the stock could push toward the $140 price targets recently set by analysts.

• Strategy: Look for a break above the recent all-time high of $134.49 on high volume.

The Bear Case (The "Valuation Trap")

Because WMT is trading at a premium P/E (historically high for them), even a "beat" on earnings might lead to a pullback if the forward outlook is cautious or if tariff-related cost concerns (imports) are highlighted.

• Strategy: The 21-day and 50-day moving averages have provided strong support during this rally. A post-earnings dip to these levels ($125–$128 range) might offer a "buy the dip" entry for a trend-following trade.

Volatility Play

Implied Volatility (IV) usually crushes immediately after the announcement.

• Strategy: Traders might consider a short put spread below the expected move (strike prices < $127) to capitalize on the IV crush, provided they are comfortable owning the stock at a lower valuation.

If we looked at the expected move for WMT, WMT have shown a decline mostly after its earnings release, so for option play, we are expecting a good revenue growth, hence, we might want to see if we can do a bull put spread.

I would think the expiry date might need to be longer than 10 days, so that we could capture the uptrend normally happen after WMT experience a dip just after its earnings release.

Technical Analysis - Exponential Moving Average (EMA)

We are seeing WMT starting to pullback from its high as market experienced volatile trading on Tuesday (17 Feb), WMT was down by more than 3.5%, so are investors looking for higher growth from WMT, and we need to be aware that there is expectation of a revenue growth of around 5% and institutional views are predominantly bullish.

So could this correction on Tuesday (17 Feb) be temporary and I think we can watch the price action closely on 18 Feb to see if there is an opportunity to capture any trade.

Summary

Walmart (WMT) is set to report its fiscal Q4 2026 earnings on February 19, 2026. With the stock trading near all-time highs and a $1 trillion market cap, the market is expecting a "flawless" finish to the fiscal year.

Q4 2026 Outlook

Analysts are projecting a strong holiday performance driven by Walmart’s digital transformation and its success in capturing higher-income demographics.

• Revenue: Expected to reach $189.9B – $190.5B, a ~5.2% YoY increase.

• Adjusted EPS: Forecasted at $0.73, a 10.6% YoY growth.

• U.S. Comp Sales: Targeted at 4.3%, sustained by robust transaction volume.

Strategic Pillars

Investors are no longer viewing Walmart as just a "big box" retailer; the valuation now reflects a "tech-efficiency premium." Key areas of focus include:

1. AI & Automation: Over 60% of stores are now serviced by automated distribution. Investors will look for a "cost to serve" reduction, as automated fulfillment has already shown a 20% unit cost advantage over manual sites.

2. Higher-Income Retention: Walmart reports that 75% of recent market share gains are from households earning >$100k. The Q4 report must prove this "new" customer base is sticky and not just seasonal.

3. High-Margin "Flywheel": Growth in Walmart Connect (Advertising) and Walmart+ (Membership) is critical. These segments offset thin retail margins and are essential to the current 45x forward P/E valuation.

The "Make or Break" Guidance

While Q4 numbers are likely to be strong, the FY2027 guidance will dictate the stock's short-term trajectory. Management must navigate a "K-shaped" consumer environment and potential tariff-related cost pressures.

The lesson from recent quarters is clear: Walmart’s pivot to the Nasdaq and heavy AI integration have changed its DNA. If the company guides for double-digit operating income growth for the next year, it could spark a run toward analyst price targets of $140. However, with the stock priced for perfection, even a slight "wait-and-see" outlook on margins could trigger a "sell the news" reaction.

Appreciate if you could share your thoughts in the comment section whether you think WMT could surprise with a strong Q4 and we might see a short-term rally with a positive FY 20227 guidance.

@TigerStars @Daily_Discussion @Tiger_Earnings @TigerWire @MillionaireTiger appreciate if you could feature this article so that fellow tiger would benefit from my investing and trading thoughts.

Disclaimer: The analysis and result presented does not recommend or suggest any investing in the said stock. This is purely for Analysis.