Wal-Mart Stores (WMT) reported quarterly earnings Thursday that topped expectations, but guidance for the first quarter came in shy of estimates as higher gas prices and the payroll tax increase cut into consumer spending.
Wal-Mart also said it would raise its fiscal year 2014 dividend to $1.88 share, or an increase of 18 percent.
After the earnings announcement, the company's shares rose slightly in pre-market trading. (Click here to track the company's stock following the earnings report.) (WMT)
The retailer posted fourth-quarter earnings excluding items of 1.67 per share, up from $1.44 a share in the year-earlier period.
Revenue increased to $127.9 billion from $123.17 billion a year ago.
Wall Street analysts had expected the discount retailer to report earnings excluding items of $1.57 per share on $128.77 billion in revenue.
Wal-Mart said it expects to earn between $1.11 and $1.16 a share in the first-quarter, which is lower than analysts' forecasts. According to Thomson Reuters, the average analyst forecast for first-quarter earnings was $1.18 a share.
"February sales started slower than planned, due in large part, to the delay in income tax refunds. We began seeing increased tax refund check activity late last week in our stores, resulting in a more normalized weekly sales pattern for this time of the year," Bill Simon, Walmart U.S. president and chief executive officer, said in a statement.
He added that consumers have been pressured by rising fuel prices, changes in inflation, and the payroll tax increase.
"The big news came out last week on Friday," Dana Telsey, CEO and chief research officer of Telsey Advisory Group, told CNBC's "Squawk Box," referring to a leaked internal company email, in which an executive called February sales a "total disaster."
She added: "This is basically confirmation and now the settling down of the estimates. People look at the valuation and say what do we see for 2014."
Telsey said her target on the stock overall was around $80 a share.
For the fourth quarter, Walmart U.S. saw same-store sales increase 1 percent, gaining market share in food, consumables, health & wellness, as well as the entertainment categories and toys, the company said.
Wal-Mart projects its full-year earnings in the range of $5.20 to $5.40 a share, compared with an estimate of $5.37 a share.
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