Equities Update: Admiral, Walmart…

Admiral pays out special dividend after results beat

Adam Vettese, Market Analyst at investment platform eToro, said:  “If something goes wrong, we might ask – will the insurance pay out? Admiral certainly has this morning, announcing a special dividend after posting a very robust set of results. Inflation has sent costs of everything higher, insurance premiums included, which is great for firms like Admiral, but the firm has astutely used that buffer in the first half of this year to cut prices and get a competitive edge on its peers. It’s hard to argue against this strategy having paid off with turnover up 43%.”

“This performance was predominately driven my motor policies and with the acquisition of More Than, Admiral can bolster its household and pet divisions with diversity. As inflation eases, we could see premiums cool off further which no doubt the firm will have one eye on. Shares are still almost 30% away from their post-Covid peak and investors will be hoping more strong performance can propel the price back up towards those levels.”

Strong sales, improved forward guidance help lift Walmart

Mark Crouch, market analyst at investment platform eToro, says: “American discount retailer Walmart reported healthy sales growth for its fiscal second quarter, beating expectations with both its top and bottom line.

“Although earnings dropped substantially from the same quarter a year ago, the decrease was smaller than analysts had expected, and came alongside a robust increase in revenue, seen across both physical stores and eCommerce channels. The latter was a particular bright spot, with global eCommerce sales growing 21%, while newer parts of the business, such as Walmart Marketplace, are beginning to contribute meaningfully to performance.

“Walmart is the biggest retailer in the States and is consequently considered a bellwether for the US consumer. The sales strength shown in these numbers should help to allay concerns about the health of consumer demand, which plays a major part in the US economy. The buoyancy seen in its sales has led the company to up its forward guidance and it now expects full year sales to increase in a range of 3.75% to 4.75%, compared to its original full year guidance of 3% to 4%.

“Shares in Walmart pushed 6% higher in pre-market trading on Wall Street, following the release of its earnings report.”