Walmart Inc.

Walmart Inc. (NYSE: WMT) offers shopping opportunities in both retail stores and through e-commerce and provides access to its other service offerings. The Company offers an assortment of merchandise and services at everyday low prices (EDLP). Noted below are the key price indicators for the stock:

WMT’s Fundamental Highlights: (Q1FY23)

• Company delivered strong top-line growth globally. Total sales increased by 2.4% or 2.6% in constant currency to USD 141.6 bn. Growth was severely impacted by divestitures (USD 5.0 bn) and currency (USD 0.4 bn).
• Consolidated operating expenses as a percentage of net sales rose 45 basis points, primarily because of higher wage costs at Walmart U.S., while the combined gross profit rate decreased 87 basis points, primarily because of Sam's Club and 38 basis points at Walmart U.S. on higher supply chain costs and product mix.
• Operating income for the entire company decreased by 23.0 % to USD 5.3 bn, or USD 0.3 bn, because of divestitures.
• Walmart Q2FY23 consolidated net sales are expected to increase by 4% YoY in constant currency terms while operating income to decrease by 1% YoY. The company’s guidance assumes a generally stable consumer in the U.S., higher supply chain costs, continued pressure from inflation, and a mix of products and formats globally.

Technical Observation (on the Weekly Chart)

After encountering repeated resistance higher levels, WMT’s stock price has seen a significant correction and has broken the 50-day moving average (DMA) on the weekly chart. The leading indicator RSI (14-period) is below the the mid-range and is showing a reading of ~37.441. Moreover, CMP is below the trend-following indicators 21-period & 50-period SMA, which may act as the resistance level for the stock. 

As per the above-mentioned price action and technical indicators analysis, a ‘Watch’ rating has been given on Walmart Inc. at the close price of USD 121.58 (as of June 30, 2022). Investors can evaluate the stock based on the support and resistance levels provided in the report in case of keen interest taking into consideration the risk-reward scenario. 

Block, Inc.

Block, Inc. (NYSE: SQ) together with its subsidiaries, creates tools that enables sellers to accept card payments and provides reporting and analytics, and next-day settlement. Noted below are the key price indicators for the stock:

SQ’s Fundamental Highlights: Q1FY22

• During the Q1FY22, the company’s total reported revenue stood at USD 3.96 billion, declined 22% on a YoY basis, on account of decrease in bitcoin revenue.
• Gross profit in Q1FY22 jumped by 34% to USD 1.29 billion, primarily because of reduction in the Bitcoin costs. Further, the Gross profit is in the increasing trend from last four quarters.
• Company reported an increase in the Canadian market share in Q1FY22.

Technical Observation (on the Weekly Chart)

On the weekly chart, SQ's prices are trading with the lower lows and lower highs formation, indicating an overall downtrend for the stock. The leading indicator RSI (14-period) is in an oversold zone and is showing a reading of ~30.474. The CMP is below the trend-following indicators 21-period & 50-period SMA, which may act as the resistance level for the stock. 

As per the above-mentioned price action and technical indicators analysis, a ‘Watch’ rating has been given on Block, Inc. at the close price of USD 61.46 (as of June 30, 2022). Investors can evaluate the stock based on the support and resistance levels provided in the report in case of keen interest taking into consideration the risk-reward scenario.

Quanta Services, Inc.

Quanta Services, Inc. (NYSE: PWR) is a provider of specialty contracting services, delivering infrastructure solutions for the electric and gas utility, communications, pipeline and energy industries in the United States, Canada, Australia and select other international markets. Noted below are the key price indicators for the stock:

PWR’s Fundamental Highlights: Q1FY22

• Revenues were USD 3.97 bn in the first quarter of 2022 as opposed to USD 2.70 bn in the same period the previous year, and net income attributable to common stock was USD 84.6 mn, or USD 0.57 per diluted share, in the first quarter of 2022 as opposed to USD 89.8 mn, or USD 0.62 per diluted share, in the same period the previous year.
• Cash and cash equivalent as of March 31, 2022, were USD 238 mn while having negative free cash flows for the Q1FY22 of negative USD 25.1 mn.
• The business prognosis for Quanta is favorable over the long run. The company's previous performance, however, has been influenced by weather, regulations, permitting, supply chain, and other variables that affect project time and execution. These issues may also have an impact on Quanta's future financial results.
• Quanta has revised its forecast for the full year ending December 31, 2022, expecting sales of between USD 16.20 bn and USD 16.70 bn and net income attributable to common stock of between USD 515 bn and USD 590 bn.

Technical Observation (on the Weekly Chart)

On the weekly chart, stock price of PWR is facing resistance of the horizontal support line and consolidating at higher levels, indicating pause in bullish momentum. However, CMP is above the trend-following indicators 21-period & 50-period SMA, which may act as the support level for the stock. The leading indicator RSI (14-period) is above the mid-range and is showing a reading of ~55.137. 

As per the above-mentioned price action and technical indicators analysis, a ‘Watch’ rating has been given on Quanta Services, Inc at the close price of USD 125.34 (as of June 30, 2022). Investors can evaluate the stock based on the support and resistance levels provided in the report in case of keen interest taking into consideration the risk-reward scenario.             

Note 1: Investment Related Risks: This report may be looked at by Investors with sufficient risk appetite looking for returns within a short investment duration. Investment recommendations provided in this report are solely based on technical parameters, and the fundamental performance of the stocks has not been considered in the decision-making process. Other factors which could impact the stock prices include market risks, regulatory risks, interest rates risks, currency risks, social and political instability risks etc.

Note 2: How to Read the Charts?

The Green colour line reflects the 21-period moving average while the red line indicates the 50- period moving average. SMA helps to identify existing price trend. If the prices are trading above the 21-period and 50-period moving average, then it shows prices are currently trading in a bullish trend.

The Black colour line in the chart’s lower segment reflects the Relative Strength Index (14-Period) which indicates price momentum and signals momentum in trend. A reading of 70 or above suggests overbought status while a reading of 30 or below suggests an oversold status.

The Blue colour bars in the chart’s lower segment show the volume of the stock. The volume is the number of shares that changed hands during a given day. Stocks with high volumes are more liquid than stocks with lesser volume as liquidity in stocks helps in easier and faster execution of the order.

The Orange colour lines are the trend lines drawn by connecting two or more price points and used for trend identification purposes. The trend line also acts as a line of support and resistance.

Technical Indicators Defined: -

Support: A level at which the stock prices tend to find support if they are falling, and downtrend may take a pause backed by demand or buying interest.

Resistance: A level at which the stock prices tend to find resistance when they are rising, and uptrend may take a pause due to profit booking or selling interest.

Stop-loss: In general, it is a level to protect further losses in case of any unfavorable movement in the stock prices.

The reference date for all price data, volumes, technical indicators, support, and resistance levels is June 30, 2022. The reference data in this report has been partly sourced from REFINITIV. 

Abbreviations

CMP: Current Market Price

SMA: Simple Moving Average

RSI: Relative Strength Index

USD: United States dollar 

Note: Trading decisions require a thorough analysis by investors. Technical reports in general chart out metrics that may be assessed by investors before any stock evaluation. The above are illustrative analytical factors used for evaluating the stocks; other parameters can be looked at along with additional risks per se. Past performance is neither an indicator nor a guarantee of future performance.