Walmart stands out as a clear winner as retailers start reporting earnings next week, Deutsche Bank said in a note Friday. The big box retailer is set to announce fiscal first-quarter results before the bell on Thursday. Target and TJX Companies are also among those on the earnings calendar next week. Analyst Krisztina Katai said Walmart is her top pick and pointed to its “sales momentum and ability to start growing EBIT margin through a multi-year time frame.” She expects upside likely at both Walmart and Sam’s Club. She raised her estimate on Walmart’s same-store sales to a 6% gain, versus her prior 5.5% gain and Sam’s Club to a 8.5% increase, up from her previous 6.8% forecast. “Inventories are in good shape across big box retail, we observed relatively in line promotions across peers, and food inflation appears to be steadily passed through,” Katai wrote. While the retailer generally doesn’t change its full-year forecast until the second quarter, she sees the potential for earnings-per-share estimates to be moved up to be more in-line with the consensus range of $6.05-$6.15. WMT YTD mountain Walmart’s year-to-date performance Earlier this week, Katai also named Walmart one of the best ways to play the softening of consumer spending . Recent data from Bank of America showed that its credit card spending for April dropped 1.2% from the prior year, the first negative year-over-year reading since February 2021. Walmart is among those “well positioned to take advantage of value seeking consumers and need-based purchases,” Katai said in her Monday note. — CNBC’s Michael Bloom contributed reporting.
