The American consumer is back, and so is Walmart, at least for now.
Walmart stock surged more than 10 percent after the company reported fiscal second-quarter earnings and sales that beat estimates and the best comparable sales growth in a decade. Sales were boosted by groceries, apparel, seasonal merchandise, and its e-commerce sales popped 40 percent.
Walmart's bullish sales report follows a surprise uptick in July retail sales, reported by the government Wednesday. U.S. retail sales jumped a half percent in July, or 6.4 percent annually, after a 0.1 percent dip in June, but that followed solid spending earlier in the spring. The U.S. economy in the second quarter, grew at 4.1 percent, the best pace in four years, and the consumer's strength is a positive omen for third-quarter growth.
Walmart, once the undisputed icon of American consumerism, has taken a back seat to Amazon, as its e-commerce business transformed the retail landscape over the last decade, forcing brick-and-mortar stores to adapt or die. Other retailers also had upbeat reports this week, including Home Depot
Analysts credited Walmart's success in the latest quarter with its change in online strategy as well as the solid consumer, armed with the proceeds from tax cuts and more confidence overall. Walmart U.S. CEO Greg Foran said the retailer is attracting new customers as it expands online groceries, but also existing customers are adding more to their carts. He said the sales are growing across the country, with no one particular market standing out, a solid foundation for the company's initiatives.