![When you keep prices reasonable, the foot traffic takes care of itself, says Jim Cramer](https://freeamericanetwork.com/wp-content/uploads/2024/08/cramer-says-walmarts-strong-quarter-may-not-be-indicative-of-consumers-as-a-whole.jpg)
CNBC’s Jim Cramer reviewed Walmart‘s quarter, suggesting the big-box retailer’s strong results are due to its successful business strategy and aren’t necessarily indicative of a favorable consumer landscape.
“Don’t make the mistake of assuming that Walmart’s results give you some kind of generic read on the consumer,” Cramer said. “You can’t just extrapolate from the best operator in the industry to everyone else.”
Walmart on Thursday topped analysts’ expectations for earnings and revenue and raised its full-year forecast. The stock reached a new 52-week high and by close shares were up 6.6%.
Investors have broadly worried about the state of consumer spending across the retail sector as inflation persists, but CEO Doug McMillon on the conference call said that, so far, the company is not “experiencing a weaker consumer overall.” Walmart also reported solid business in China, which has been lagging for many other major consumer-oriented companies.
While Thursday also brought a stronger-than-expected consumer spending report for July, according to Cramer, Walmart’s success lies with its value prices and convenient services like online delivery. He said when a company keeps prices at reasonable levels, “the traffic takes care of itself.”
Walmart management indicated on the call the retailer is seeing more engagement, with higher-income customers accounting for the majority of its gains. McMillon said the cohort is willing to spend more for discretionary items and convenience.
Walmart is one of the first of the major retailers to report this earnings season. While hopeful about the company’s peers, Cramer stressed it is the leader of the pack.
“This quarter’s a testament to the fact that Walmart’s management keeps doing an excellent job,” he said. “I hope the rest of retail can come close, but when it comes to brick and mortar, with the sole exception of Costco, Walmart’s in a league of its own. And, you know what, I think it’s got more room to run.”
Walmart did not immediately respond to a request for comment.
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