Walmart stock and Target headlined a Wednesday for retail stocks. Walmart climbed after the Dow Jones leader offloaded its stake in JD.com for $3.6 billion.
Elsewhere, Target soared following its Q2 report. Macy's tumbled on earnings. TJX broke out on its results. Gap rose on a positive earnings preview, while Dollar General and Dollar Tree surged.
Walmart in an unexpected move late Tuesday sold its 9.4% stake in China-based e-commerce company JD.com for $3.6 billion, according to reports. The Dow Jones retailer said it will focus on its own China operations for Walmart China and Sam's Club, as well as deploy capital toward other priorities. Reuters reported that Walmart plans to double down on its Sam's Club business in China following the stake sale.
Walmart offered 144.5 million American depositary shares of JD.com at a range of 24.85 to 25.85 per share, which represents up to an 11.8% discount from JD's Tuesday closing price of 28.19. The top end of the range would put the sale around $3.74 billion. Walmart first entered a strategic partnership with JD.com in June 2016 when it purchased a 5% stake in the company.
The announcement comes after Walmart cleared Q2 forecasts last Thursday with a beat-and-raise report.
Walmart stock climbed about 1% Wednesday. WMT stock has rallied 43% in 2024, making it the Dow's fastest-moving stock this year.
JD.com shares pared losses to 4.2%.
Macy's And TJX Diverge
Elsewhere, legacy retailer Macy's on Wednesday reported earnings of 53 cents per share to beat FactSet estimates of 30 cents. Revenue fell 3.8% to $4.94 billion, which missed analyst views of $5.05 billion.
The company-owned stores saw comparable sales fall 4%, also missing estimates of about a 1% decline.
Macy's lowered its 2024 net sales guidance to "reflect a more discriminating consumer and heightened promotional environment relative to its prior expectations." The company sees revenue ranging from $22.1 billion to $22.4 billion, down from its May guidance of $22.3 billion to $22.9 billion. Macy's lowered comparable sales forecasts to range from a 2% to 0.5% decline, from prior views of a 1% decrease to 1.5% growth. The company maintained its adjusted earnings outlook to range from $2.55 to $2.90 per share.
M stock unraveled 13% Wednesday, dropping well below its 50-day moving average.
TJX on Wednesday reported fiscal second quarter 2025 earnings of 96 cents per share, which cleared analyst forecasts for 92 cents. Revenue increased 6% to $13.47 billion, ahead of estimates of $13.31 billion.
Consolidated comparable sales rose 4%, also beating views for 2.8% growth.
For fiscal Q3 2025, TJX expects comparable sales to climb 2% to 3% while earnings range from $1.06 to $1.08 per share. FactSet expects earnings of $1.10 per share on 2.7% same-store sales growth. TJX sees full-fiscal year 2025 earnings ranging from $4.09 to $4.13 per share, which matched FactSet views of $4.13 per share. The company guided full-year comparable sales to rise about 3%, also matching analyst estimates.
TJX stock jumped 6% Wednesday to clear a 115.34 buy point for a six-week flat base.
TJX stock rallied 28% this year.
Discount Retailers Climb
Other retailers also gained ground early Wednesday.
Gap surged on a positive earnings preview ahead of its Aug. 29 report. Citi on Wednesday opened a "positive catalyst watch" on Gap and expects a "big" earnings beat for Q2, driven by stronger gross margins and a beat for same-store sales forecasts, The Fly reported. Citi also expects Gap to raise its 2024 sales guidance and earnings outlook on the results, from $1.60 per share now to $1.70 per share or more. The firm kept a buy rating and 32 price target on Gap shares.
GAP stock popped 4.4% Wednesday.
Discount and variety retailers also rose. Dollar General pared its early surge to 1.7% while Dollar Tree closed the day up 0.8%.
Ross Stores jumped 4.2% ahead of its earnings report, set for late Thursday.
ROST stock closed above a 153.06 buy point for a flat base.
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