Walmart and Domino's Pizza Among Top Stock Picks Amid Tariffs

Three high-quality stocks that have lagged recently but may still be worth investing in are Walmart, Domino's Pizza, and Lowe's. Walmart's earnings fell short due to the impact of tariffs, but its revenue growth and same-store sales growth are still positive. Domino's Pizza's stock has not performed well despite Warren Buffett's investment in the company. Lowe's has underperformed due to concerns about the housing market, but its strong balance sheet and improving sales trends make it a potential buying opportunity.

Walmart (WMT), Domino's Pizza (DPZ), and Lowe's (LOW) are three high-quality stocks that have lagged recently but may still be worth investing in. Each of these companies faces unique challenges, but their strong fundamentals and long-term growth potential make them compelling investment opportunities.

Walmart (WMT)

Walmart raised its financial forecasts for the fiscal year, but its earnings fell slightly short of Wall Street’s expectations. The stock was down 4.3% approaching midday on Thursday, becoming the worst performer in both the S&P 500 index and the Dow Jones Industrial Average, which were both 0.4% lower [1].

Despite the earnings miss, Walmart demonstrated strong operational momentum with e-commerce sales surging 25% globally and 26% in the U.S. The company raised its full-year net sales growth outlook to 3.75%-4.75% from the previous 3%-4% range, while slightly increasing its adjusted EPS guidance to $2.52-$2.62 per share [2].

Domino's Pizza (DPZ)

Domino's Pizza, with a stake held by Warren Buffett's Berkshire Hathaway, has not performed well despite the company's strong fundamentals. The stock's back to where it was when Berkshire Hathaway first established a stake in the company. If you're going to buy a Buffett stock, though, you need to have Buffett-like patience. That means a willingness to hold it for years on end and not worry about any volatility it experiences in the meantime [3].

Domino's Pizza's long-term results have been impressive. Removing pandemic-skewed comparisons from the mix, this company hasn't failed to grow its top line in any quarter since late 2012, growing its annualized sales from less than $1.7 billion then to nearly $4.8 billion now. Profit growth hasn't been quite as consistent but certainly as impressive. The company's 2012 net income of $113 million has since grown to nearly $600 million [3].

Lowe's (LOW)

Lowe's has underperformed due to concerns about the housing market, but its strong balance sheet and improving sales trends make it a potential buying opportunity. The company's strong balance sheet provides a cushion against economic downturns, and its improving sales trends indicate a potential turnaround in the housing market [3].

Conclusion

While these three stocks have lagged recently, their strong fundamentals and long-term growth potential make them compelling investment opportunities. Investors should consider these factors when evaluating these stocks for potential investment.

References

[1] https://www.barrons.com/articles/walmart-stock-price-earnings-4008b5aa
[2] https://www.tikr.com/blog/walmart-stock-slips-over-4-as-the-retail-giant-missed-fiscal-q2-earnings-estimates
[3] https://finviz.com/news/148324/my-3-favorite-stocks-to-buy-right-now