Analysts are not turning on Walmart (WMT) ahead of the holiday season.
The Bentonville, Arkansas-based company's stock is sliding on Thursday despite a strong quarter that reflected a strong beat on earnings per share and what would have been another beat on revenue if not for a currency headwind. After the positive report, the company went further to raise guidance ahead of key holiday sales.
Given the disconnect between the market reaction and quarterly numbers, some analysts have advised buying on weakness. Walmart shares were down 2.14% to $99.33 as of 2:35 p.m. ET.
"WMT's comps outperform as impressive customer traffic continues across stores and digital," Cowen analyst Oliver Chen wrote in a note. "The retailer has done a good job leveraging in-store costs on strong comps. We would be buyers on potential weakness given 1.6% EPS raise."
He explained that strong results in the third quarter bode very well moving into the company's strongest season as well, especially as the retail space becomes less crowded.
"Lots of stockings will be stuffed with WMT goods," Chen declared.
The opportunity for growth of the already hulking Walmart is reinforced by a strong retail backdrop overall.
The U.S. Commerce Department reported Thursday that retail and food-services sales rose 0.8% in October to $511.5 billion, exceeding expectations of a 0.5% monthly advance.
That suggests that even while many speculators fear a bull market, the U.S. consumer is still out and spending in force.
These metrics are bolstered by the jobs and wage numbers released earlier this month which reflect a larger base of employed consumers with more spending power.
The results from Walmart suggest that a great degree of this spending power is heading to some of the big-box leaders as well.
"Recent results from Walmart and Costco (COST) , as well as likely Target (TGT) when they report next week show that scale retailers investing in multichannel are taking share amidst a favorable U.S. retail backdrop," MoffettNathanson analyst Greg Melich wrote in a note on Thursday. "A recent moderation in growth at Amazon (AMZN) , as well as competitor closures aren't hurting either, with Toys R Us, Sears (SHLD) , Fred's (FRED) , and even Family Dollar named share donors."
That donation of share could be helped along further as JCPenney (JCP) encounters its own trouble and may donate some share of gift sales into Christmas.
Amid the tailwinds available, analyst consensus remains a "Buy" for Walmart, per FactSet data with a price target of about $105 per share.
For investors bullish on the retail space, today's bearish slide could provide a solid buying opportunity. Much of Wall Street certainly thinks so.