Updated: Feb 8, 2021
As Q4 earnings season continues, we have seen most of the large ecommerce and tech companies crush earnings. We think Walmart will do the same on Thursday February 18th Premarket.
Amazon increased it's quarter over quarter revenue by a whopping 44% This is mainly due to the online shopping surge. Walmart has been growing its ecommerce substantially with Walmart + & Tiktok Deal
If you take a deep look at what did well for Amazon in their earnings report, then you will see the online space thrived even more so than last year because of the increased need to buy things online. Amazon increased their online consumer sales solely in the US by 1 billion from the previous quarter. The pandemic was a large catalyst for this phenomenon. Amazon went down in price due to the news of their CEO Jeff Bezos stepping down. Even though Amazon crushed earnings, a lot of risk was added by having a new CEO.
This shows the strength in the consumer as the pandemic has caused for concern. Walmart is the go to retail place for food, supplies and even gifts for holidays. They have opened up Walmart+ which allows for shipping and this should be a large benefit in this novel Covid-19 environment. We are looking for growth there as it should be something that positively impacts Walmart's future revenues. Another online aspect of Walmart is the deal with using TikTok as a platform to advertise their products. We think this will be a major revenue booster for Walmart. Walmart has been trying to shift to online for years to compete with Amazon, and I think they are coming around the corner especially with the Pandemic accelerating efforts to create a ecommerce zone. Tiktok will be an excellent platform for Walmart to bolster it's ecommerce revenue.
With these details, We think Walmart is at a fire sale price of $144 as of writing. We expect the stock price to rise above $160 per share after earnings.
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We alerted our subscribers of a call option on Walmart when it was $141 per share. This has already made 30% returns and expect it to make 50-80% returns.
A high opportunity option play is a long call Strike $150 for February 26th
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