Walmart Gives Up All Gains After Company Warns Of Revenue Slowdown Amid Stimulus “Taper”

After soaring as much a 6.7% premarket following blockbuster earnings that saw non-GAAP EPS print above the highest sellside estimate and comp store sales which came in at 9.9% vs the 6.2% consensus estimate , Walmart shares turned red as investors were spooked by company commentary about the current quarter. Specifically, the selling started after the company unveiled that topline performance slowed in July to around 4%.

According to RBC analyst Scot Ciccarelli, WMT comments that sales begin to “normalize” in July “may suggest that the outsized gains experienced over the last few months may be starting to ebb” as government stimulus money “tapered off.”

He adds that while Wall Street should be expecting a slowdown from the quarter’s “nearly 10% run rate, the magnitude of change may give some investors pause as sales sustainability is one of today’s key topics in retail.” His price target: $132, or just where the company closed on Monday.

Separately, Bloomberg notes that while MKM’s Bill Kirk wrote that the retailer’s “strong” gross margin was a positive sign for peers, he too would be listening for comments on call regarding the “interruption of stimulus checks” impact on August and what Walmart intends to do with its ~$17bn cash balance.

Investors aren’t likely to show ass much patience, and after pushing the stock as high as $144 premarket, it was last trading some $9 lower.