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Walmart Inc. (NYSE:WMT) Chief Executive Doug McMillon said there should be a discussion about banning assault weapons in the U.S.

Walmart Inc. (NYSE:WMT) Chief Executive Doug McMillon said there should be a discussion about banning assault weapons in the U.S.

Walmart Inc. Chief Executive Doug McMillon said Thursday there should be a discussion about banning assault weapons in the U.S.

McMillon made the comment as Walmart released fiscal second-quarter earnings, but neither he nor Dan Bartlett, Walmart’s WMT, +6.11% executive vice president of corporate affairs who participated in a media call after the earnings were announced, offered specifics on Walmart’s position on the issue.

The retail giant has been at the center of a discussion on gun violence following the Aug. 3 mass shooting at an El Paso Walmart store and a shooting in Mississippi that killed two workers.

Walmart stopped selling military-style rifles including AR-15s in 2015, and ceased selling handguns in every state but Alaska in the mid-1990s.

The retailer raised the age limit to 21 from 18 to buy a gun or ammunition in 2018 after the mass shooting at Marjory Stoneman Douglas High School in Parkland, Fla.

“In the national conversation around gun safety, we’re encouraged that broad support is emerging to strengthen background checks and to remove weapons from those who have been determined to pose an imminent danger,” McMillon said in his comments.

Walmart only sells guns after a background check gets the “green light,” while federal law only requires that there is no “red light” after three business days. And the company will only allow certain employees to sell guns, videotapes the point of sale and has locking cases for firearm security.

“We do not sell military-style rifles, and we believe the reauthorization of the assault weapons ban should be debated to determine its effectiveness in keeping weapons made for war out of the hands of mass murderers,” McMillon said.

“We must also do more to understand the root causes that lead to this type of violent behavior.”

Walmart accounts for about 2% of the firearms market today, the company estimates, “which we believe places us outside at least the top three sellers in the industry.” And the retailer says it has about a 20% share of ammunition.

“We think it’s time for Congress to debate,” Bartlett said on the media call. “We’ll lend our perspective. We look forward to the conversation.”

McMillon issued a statement to the company’s associates in the wake of the El Paso shooting in which he said the company was trying to understand the issues that have come out of the shootings at Walmart locations.

“We will be thoughtful and deliberate in our responses, and we will act in a way that reflects the best values and ideals of our company, with a focus on serving the needs of our customers, associates and communities,” the statement said.

Walmart has come under increasing pressure to stop selling guns and was threatened with a boycott after it removed videogame signs displays for films and hunting videos that reference gun violence, but kept guns for sale.

Walmart also reported mixed earnings with profits beating expectations but sales falling short. U.S. same-store sales rose 2.8%, beating the FactSet consensus for 2.6% growth, while e-commerce grew 37%.

The results were enough to push stock futures into positive territory in the premarket hours. Walmart stock was up 4.4% in Thursday trading.

“We like Walmart given the stock’s defensive qualities as we believe the retailer can perform well in both a cautious and optimistic consumer and retail environment,” Cowen analysts wrote in a note. “We have high conviction that combining physical stores with digital options is the future of retail and Walmart shines here.”

Cowen rates Walmart stock at outperform with a $130 price target.

“Walmart continues to steam ahead, with Q2 results again generating favorable returns on the company’s prior investments, a trend which we expect to continue for the foreseeable future,” said Charlie O’Shea, vice president at Moody’s. “In particular, U.S. performance improved on all fronts year-over-year despite the impact of increased promotions in the quarter, particularly surrounding Amazon’s mid-July Prime Day, and Walmart continues to tactically grow market share as evidenced by increased margins.”

Analysts anticipated that other retailers would benefit from the Amazon.com Inc.AMZN, +0.75% Prime Day event in July. Walmart’s McMillon would comment no further than to say that e-commerce was “strong” during the quarter “including for our four-day July sales event.”

The Walmart results likely had many investors in the retail sector breathing a sigh of relief after disastrous numbers from Macy’s Inc. M, -3.81% on Wednesday, which demonstrated the weakness at department stores that Moody’s has described in recent months, and had other analysts concerned that retail is in worse shape than expected.

Walmart stock has rallied 21% for the year to date while the Dow Jones Industrial Average DJIA, +0.39% has gained 9.7% and the S&P 500 index SPX, +0.25% is up 13.6%.

Technical Indicators

Overall, the bias in prices is: Upwards.

The projected upper bound is: 116.81.

The projected lower bound is: 108.90.

The projected closing price is: 112.86.

Candlesticks

A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 6 white candles and 4 black candles for a net of 2 white candles. During the past 50 bars, there have been 24 white candles and 25 black candles for a net of 1 black candles.

A doji star occurred (where a doji gaps above or below the previous candle). This often signals a reversal with confirmation occurring on the next bar.

A long lower shadow occurred. This is typically a bullish signal (particularly when it occurs near a low price level, at a support level, or when the security is oversold).

A rising window occurred (where the top of the previous shadow is below the bottom of the current shadow). This usually implies a continuation of a bullish trend.

Three white candles occurred in the last three days. Although these candles were not big enough to create three white soldiers, the steady upward pattern is bullish.

Momentum Indicators

Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.

Stochastic Oscillator

One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 70.4437. This is not an overbought or oversold reading. The last signal was a buy 6 period(s) ago.

Relative Strength Index (RSI)

The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 58.27. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 7 period(s) ago.

Commodity Channel Index (CCI)

The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is 111.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a buy 2 period(s) ago.

MACD

The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 0 period(s) ago.

Rex Takasugi – TD Profile

WALMART INC closed up 6.490 at 112.690. Volume was 131% above average (neutral) and Bollinger Bands were 48% wider than normal.

Open     High      Low     Close     Volume___
112.680 113.610 110.160 112.690 3,825,325
Technical Outlook 
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bullish
Moving Averages: 10-period     50-period     200-period
Close: 107.80 110.53 101.30
Volatility: 46 23 22
Volume: 2,118,238 1,615,081 1,964,309

Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.

Summary

WALMART INC gapped up today (bullish) on normal volume. Possibility of a Runaway Gap which usually signifies a continuation of the trend. Four types of price gaps exist – Common, Breakaway, Runaway, and Exhaustion. Gaps acts as support/resistance.
WALMART INC is currently 11.2% above its 200-period moving average and is in an downward trend. Volatility is extremely high when compared to the average volatility over the last 10 periods. There is a good possibility that volatility will decrease and prices will stabilize in the near term. Our volume indicators reflect volume flowing into and out of WMT.N at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bearish on WMT.N and have had this outlook for the last 15 periods.

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