Wal-Mart Stores Inc. (WMT) reported strong fiscal third-quarter earnings of 84 cents per share, which surpassed the Zacks Consensus Estimate of 81 cents. Earnings grew 9.1% year over year from 77 cents recorded in the year-ago quarter, and exceeded management’s guidance of 78 cents to 82 cents per share.

Wal-Mart’s net sales recorded a growth of 1.1% year over year to $98.7 billion, as a 1.2% expansion in Wal-Mart’s U.S. segment coupled with a 1.6% increase in the International segment was partially offset by 0.7% decline in the Sam’s Club segment. The growth in International sales was driven by robust performance in the U.K., Mexico and Brazil, but was limited by unfavorable currency fluctuations.

The retailing behemoth, widely considered as a barometer of the country’s economy, said U.S. same-store sales dipped 0.5% year-over-year, while that for Sam’s Club rose by 0.1%.

Customers battered by the worst recession in decades are shopping more often in discount department stores such as Wal-Mart, as opposed to non discount-oriented retailers. However, the company remains affected by rising unemployment, which has adversely affected consumers’ disposable incomes.

For the first nine months of the fiscal year, the company generated a robust free cash flow of $3.6 billion, compared to $2.3 billion in the year-ago period, primarily due to improved inventory management.

Moving forward, Wal-Mart lifted its guidance for the full year ending January 2010 after better-than-expected quarterly results, and now expects to post earnings of $3.57 to $3.61 per share, up from $3.50 to $3.60 per share predicted earlier. The Zacks Consensus Estimate, derived from 22 covering analysts, is currently pegged at $3.58 per share.

For the fourth quarter of the fiscal year, earnings are expected to range between $1.08 and $1.12 per share, in-line with the Zacks Consensus Estimate of $1.12. Same-store sales for Wal-Mart U.S. in the fourth quarter are expected to be flat, +/- 1%, while Sam’s Club same-store sales during the same period are also forecasted to be flat, +/- 1%.
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