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Wal-Mart Stores Inc on Thursday reported higher-than-expected quarterly sales at established US stores, as a huge investment to bring more customers into the discount retailer paid off and a bigger push into e-commerce boosted online purchases, sending its shares to a 52-week high.

Wal-Mart and analysts said the company is benefiting from a $2.7 billion investment to increase entry-level wages and enhance the training of its workforce, which has led to better stocked shelves and cleaner stores. It said store visits rose 1.5 percent, the tenth consecutive quarterly increase.

"Wal-Mart's long string of investments in labour and e-commerce, including acquisitions, are enabling modest market share gains," John Zolidis, director equity research with the Buckingham Research Group said. Shares of Wal-Mart rose to $77.40 - a 52-week high. As of Wednesday's close, the stock had risen 8.7 percent so far this year. Wal-Mart's performance, along with rival Target Corp's results on Wednesday, bucked a string of weak results by department store retailers like Macy's Inc. On Wednesday, Target reported higher-than-expected quarterly earnings and sales, and set an optimistic tone for the year.

Wal-Mart said sales at US stores open at least a year rose 1.4 percent, excluding fuel price fluctuations, and was the 11th consecutive quarterly increase. Analysts were expecting a 1.3 percent increase, according to Consensus Metrix. Online sales rose 63 percent in the first quarter, which was higher than 29 percent growth in the fourth quarter. The company said most of the growth was from its existing online operations rather than from acquisitions. Online sales added 0.8 percentage points to the first quarter comparable sales gain.

Earnings per share was $1 for the quarter ended on April 30, exceeding the analysts' average estimate of 96 cents, according to Thomson Reuters I/B/E/S. Consolidated net income fell to $3.04 billion from $3.08 billion due to a higher tax rate. Quarterly revenue rose 1.4 percent to $117.5 billion, slightly lower than analysts expectations of $117.7 billion due to a stronger dollar, which reduces the value of overseas sales. Revenue grew 2.8 percent on a currency neutral basis. For the second quarter, Wal-Mart said it expected an increase of 1.5 percent to 2 percent in US same-store sales. It forecast earnings per share of $1 to $1.08, against market expectations of $1.07.

Copyright Reuters, 2017

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