Wrapping up Q3 earnings, we look at the numbers and key takeaways for the large-format grocery & general merchandise retailer stocks, including Target (NYSE: TGT) and its peers.

Big-box retailers operate large stores that sell groceries and general merchandise at highly competitive prices. Because of their scale and resulting purchasing power, these big-box retailers–with annual sales in the tens to hundreds of billions of dollars–are able to get attractive volume discounts and sell at often the lowest prices. While e-commerce is a threat, these retailers have been able to weather the storm by either providing a unique in-store shopping experience or by reinvesting their hefty profits into omnichannel investments.

The 4 large-format grocery & general merchandise retailer stocks we track reported a mixed Q3. As a group, revenues were in line with analysts’ consensus estimates.

In light of this news, share prices of the companies have held steady as they are up 2.2% on average since the latest earnings results.

Weakest Q3: Target (NYSE: TGT)

With a higher focus on style and aesthetics compared to other large general merchandise retailers, Target (NYSE: TGT) serves the suburban consumer who is looking for a wide range of products under one roof.

Target reported revenues of $25.27 billion, down 1.6% year on year. This print was in line with analysts’ expectations, but overall, it was a mixed quarter for the company with full-year EPS guidance beating analysts’ expectations but a significant miss of analysts’ EBITDA estimates.

"Thanks to the incredible work and dedication of the Target team, our third quarter performance was in line with our expectations, despite multiple challenges continuing to face our business," said Michael Fiddelke, incoming Chief Executive Officer of Target.

Target delivered the weakest performance against analyst estimates and slowest revenue growth of the whole group. Interestingly, the stock is up 3.3% since reporting and currently trades at $91.43.

Read our full report on Target here, it’s free for active Edge members.

Best Q3: Walmart (NYSE: WMT)

Known for its large-format Supercenters, Walmart (NYSE: WMT) is a retail pioneer that serves a budget-conscious consumer who is looking for a wide range of products under one roof.

Walmart reported revenues of $179.5 billion, up 5.8% year on year, outperforming analysts’ expectations by 1.1%. The business had a satisfactory quarter with a decent beat of analysts’ gross margin estimates but full-year EPS guidance meeting analysts’ expectations.

Walmart delivered the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 10.8% since reporting. It currently trades at $111.58.

Is now the time to buy Walmart? Access our full analysis of the earnings results here, it’s free for active Edge members.

Costco (NASDAQ: COST)

Designed to be a one-stop shop for the suburban consumer, Costco (NASDAQ: COST) is a membership-only retail chain that sells groceries, apparel, toys, and household items, often in bulk quantities.

Costco reported revenues of $86.16 billion, up 8.1% year on year, in line with analysts’ expectations. It was a mixed quarter as it posted a solid beat of analysts’ gross margin estimates but a slight miss of analysts’ EBITDA estimates.

As expected, the stock is down 3.4% since the results and currently trades at $912.43.

Read our full analysis of Costco’s results here.

BJ's (NYSE: BJ)

Appealing to the budget-conscious individual shopping for a household, BJ’s Wholesale Club (NYSE: BJ) is a membership-only retail chain that sells groceries, appliances, electronics, and household items, often in bulk quantities.

BJ's reported revenues of $5.35 billion, up 4.9% year on year. This number met analysts’ expectations. Zooming out, it was a mixed quarter as it also recorded a beat of analysts’ EPS estimates but a slight miss of analysts’ EBITDA estimates.

The stock is down 2.1% since reporting and currently trades at $88.68.

Read our full, actionable report on BJ's here, it’s free for active Edge members.

Market Update

Thanks to the Fed’s rate hikes in 2022 and 2023, inflation has been on a steady path downward, easing back toward that 2% sweet spot. Fortunately (miraculously to some), all this tightening didn’t send the economy tumbling into a recession, so here we are, cautiously celebrating a soft landing. The cherry on top? Recent rate cuts (half a point in September 2024, a quarter in November) have propped up markets, especially after Trump’s November win lit a fire under major indices and sent them to all-time highs. However, there’s still plenty to ponder — tariffs, corporate tax cuts, and what 2025 might hold for the economy.

Want to invest in winners with rock-solid fundamentals? Check out our Hidden Gem Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.