Forecast at Walmart and Rosneft – a bright future ahead

Sergey Ruban,

analyst XCritical

Overview of the shares of Walmart and Rosneft. Predictions of last week Deutsche Post.


The company Walmart has become the icon of the retail business. In this retailer you can find not only food, but also household goods. The Corporation – the leader of retail trade in the United States. At Walmart the network is not only small shops, but giant supermarkets scattered across all the American States.

Activity Walmart has long spread beyond the United States. In the network of the Corporation includes more than 10 000 stores in 27 countries, and the number of employees exceeded million five years ago.


The history of this Corporation has more than 60 years. It was opened in 1962. Sam Walton, its founder, started the business with one store in one state, but in 5 years he already had 24 outlets and annual revenue exceeding 10 million dollars.

The next step Walton started expanding in the domestic market. The chain of stores Wal-Mart grew rapidly due to the basic principle of the company – high goods at the lowest price. Thanks to this business model in 1975, Sam Walton was already more than 100 stores in the United States.


At Walmart three business lines:

  • Walmart US
    • US the biggest of all three directions. This segment is responsible for business throughout the United States. This division is responsible for various aspects of everyday life, for example food, health, clothing, and agriculture. Here Walmart US offers its customers three main formats of stores – supermarkets, discount stores and small shops.
    • In addition to financial services, the Issuer has dealt with money transfers, customers can use the prepaid card to effect electronic transfers and bill payments.
    • US and provides online access to its products and services through websites and apps on smartphones.
  • Walmart International
    • The international segment is responsible for the business in 27 countries. In this segment there are shops both retail and wholesale formats. The trade is carried out through the joint and subsidiary enterprises. In this segment also have a digital format of buying goods.
  • Sam's Club
    • Sam's club also operates in the United States, however, responsible for warehouse clubs for their members. Sam's Club provides services primarily to individual customers and business owners.

    Financial statements

    From year to year financial performance of this company only improved. Last quarterly report only confirmed that walmart is the best in the business. So, according to the report, last year the net profit of the Issuer has risen by 12% and reached 4.13 billion U.S. dollars. Profit per share amounted to 1.38 $, only slightly short of the forecast of experts – 1.44 $. The American revenue of the retailer increased by 21% compared to last year and amounted to 141.66 billion U.S. dollars. Economists were expecting 142.4 billion U.S. dollars.

    In the past financial year in the domestic market, the company increased sales by 1.9%. In 2020, Walmart expects that this figure will rise to 2.5%.

    Technical pattern and forecast

    With the end of 2019 cases at walmart were not very. Buyers failed to pass the 120 $, and they passed the market sellers. Most likely, it was assumed technical correction and growth thereafter. In the plans of the retailer interfered with the epidemic coronavirus that has sent the paper in a long protracted fall.

    The price in March reached the area and $ 105, where there was a rebound and started to grow. The change in sentiment in the market associated with the introduction of quarantine in the United States. People were forced to sit at home and make an online purchase. At that time people were hoarding the goods for the house and food for a long time.

    This high activity of Americans has caused a sharp increase in sales in supermarkets and hypermarkets, which is clearly seen on the chart. Rebounding from support and $ 105, the price for a few weeks not only broke the highs of the end of 2019, but also set a new record value in region 132 $. Unfortunately, the market didn't stay here, and immediately after the test of resistance declined to the level of 120 $.

    With pandemic COVID-19 Walmart may significantly increase your profits. Recent months, the company invests in its infrastructure, technology and staff. Because of the hype and influx of buyers online Walmart evident lack of staff. And to handle the increased flow of customers, the Issuer has hired thousands of more workers while reducing the employment process from weeks to one day. This is a sign of a well-going business, because when things from bad to worse, new employees are not hired, and even in such quantity.

    In favor of the company will go to the new program of medical care, which is more than popular in a pandemic, the threat will continue until the end of the year.

    Experts Credit Suisse raised its forecast for the shares of Walmart with the $ 115 to 127 $. We also support a positive scenario and expect a report better than forecast. We believe that in the next quarter, the company's shares will be able not only to overcome the barrier 130 $, but remain above it. Expect prices in the area 137 $, and possibly even the $140.


    The company «Rosneft» is a leader not only the Russian oil sector, but is in the top of the world's largest oil and gas companies.

    This company provides full cycle of oil, from exploration, refining and sale of oil, gas and products of their processing.

    The company develops deposits on land and at sea. 75% of the capital of the Corporation owned by the state, which is not surprising as it accounts for about 40% of the annual oil production in Russia and 35% of its processing. From the point of view of the global market «Rosneft» occupies 6% of world production.

    The area of activities of Russian oil and gas company covers all major fields of Russia: Siberia, Central and Southern provinces of Russia, the far East and the oil reserves located in the Arctic.

    The hallmark of the company is presence of own export terminals.

    For a better control from “Rosneft” has a broad network of subsidiaries. More than 265 companies are subordinate to this Corporation. Most of them – is a fuel company and gas stations.

    a brief history of the company

    The history of the company «Rosneft» began in 1991. In this year the Soviet Union collapsed, therefore it was disbanded by the Ministry, which was responsible for the oil and gas industry Union. In return disbanded the Ministry is based oil company «Rosneftegaz”, which in 1993 becomes «Rosneft». Two years later, the company is corporatized.

    Fast enough «Rosneft» increases the efficiency of corporate governance and consolidate oil assets. Since 2005, the Issuer gets to the top oil and gas companies of the Russian Federation.

    In 2006, is the placing shares on the London Stock Exchange. The total amount of IPO exceeded to $ 10 billion, so it's IPO became the fifth largest location in the world and the largest in Russia.

    In 2013, the Corporation entered into the list of the largest public oil and gas companies in the world.

    the company's Dividend policy

    The problems in the oil market is not affected by this oil Corporation. This year, the Corporation is preparing to pay dividends following the results of 2019 in the amount of 18.07 ₽ per paper. The dividends to all investors who purchase securities of the company not later than 10 June 2020. The dividend will be paid until the end of June. The dividend yield currently average 5.5%.

    If to take into account previously paid interim dividend of 15.34 ₽, the total annual dividend will amount 33.41 ₽. This amount exceeds last year's payout by 29%.

    The increase in dividend payments was not a surprise for the market. The company is ready to direct on payment of half the net profit, the amount of which became known in February after publishing statements.

    Quarterly report of the company

    So, what turned out to be 2019 for the company «Rosneft”? Just say that last year for the oil and gas corporations have been quite successful. «Rosneft” has set several of its own records: revenue, net profit and EBITDA.

    The revenue for last year increased by 5.2% and reached the level of 8.7 trillion roubles. This figure has improved due to growth in sales of raw materials for more than 20% at lower world prices by 6.2%.

    Net profit, which belongs to the shareholders, in 2019 also improved – grew by 28% to 707 billion. Just say that in the entire history of the company «Rosneft” this figure has never reached such heights. Net income results of the Issuer at 1% was better than consensus forecasts.

    A few words about the achievements of the Corporation. In April it became known that the shares of «Rosneft» for the first time in its history was in the top ten most popular securities among private investors on the Moscow exchange. Thus, the share of the Corporation's shares in the average portfolio was 11.5%.

    Technical pattern and forecast

    Until January 2020, the company «Rosneft» went into the mountain, which is clearly seen on the chart. By the time of reversal the price reached an area of 487 ₽ where the game returned to the sellers, and not just back and got full control of the asset. So, breaking 450 ₽, they rushed down and reached for a couple of months support zone 234 ₽. From this impediment quotes «Rosneft» fell back and since then are growing. The rebound occurred about a month ago, and it was directed at the area of 350 ₽. This level proved too tough for the bulls, and they retreated to around 300 ₽, where once again went to the resistance 350 ₽. Technical indicators only began to leave “red zone”.

    C picture of the market clear. Buyers are trying, but they don't have enough. What forecast can you do?

    The case of «Rosneft» so good, more than good. Oil – this “gold mine”, which always brought a lot of money. And the company receives support from the state, and it's worth a lot. In March, the Russian company first began to buy back their shares from the market, and plans to redeem them for a total amount of 2 billion U.S. dollars. This is undeniably a positive factor for the acquisition of shares of the company.

    The experts at Credit Suisse believe that for the benefit of the Issuer, will go the tax break. The dividend yield in the current year are expected to be 9.4%, and next year the figure may be 11.2%. Implementation of the project «Vostok ojjl” should also strengthen the position of corporations in both domestic and international market.

    The only spoon of tar in this barrel of honey – low price of oil almost the entire first quarter of 2020. It can degrade the performance during this reporting period.

    If the development of the negative scenario, the order of correction can be zone or 300–305 ₽, or, in the case of a deeper correction, the area of 270–275 ₽.

    On the other hand, the customers it is important to go through the resistance 350 ₽, its break will open the way to level 400 ₽, they thereby closing the March gap.

    a Review of last week – Deutsche Post

    Back to the companies last week, and see how their dynamics changed with the release of the quarterly reports.

    , Net profit German Corporation Deutsche Post in the first quarter of 2020 fell by more than 2 times and amounted to slightly more than 300 million euros. And in 2019 for the same reporting period, the Corporation reported 746 million euros. This indicator had a negative impact of the pandemic.

    Investors poorly pleased with the Deutsche Post's revenue, which grew by only 0.9%. EBIT decreased to 591 € 1.158 million from € bn

    According to forecasts of specialists, the pandemic coronavirus will cost Deutsche Post EUR 210 million.

    The negative report caused the decline of securities of the company. So, from 28 € the asset is rolled into the area 25 € from which it rebounded to around 27 €. Most likely, the market decline will continue. Sell signal will be a breakout of the current support, followed by a decline to the levels 23 € and 22 €.

    , If happens, it will be aimed at achieving resistance 28 €. After that you will open buy trade in the direction of 30 €.

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