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Takeaway: Not a great start for new CEO Doug McMillon.

Hedgeye Retail: Wal-Mart Plays Right Into #GrowthSlowing | $WMT - 2

The chart below shows what everybody already knows: Walmart comps disappointed. The company cited weather for 20 basis points of the decline. And if there's any retailer who's data we trust, it's Wal-Mart's.

But the two-year trend, which we place much heavier weight on as it relates to drilling down the real underlying trend, is nothing to write home about. This plays right into Hedgeye's #GrowthSlowing theme as it relates to the US Consumer.

Hedgeye Retail: Wal-Mart Plays Right Into #GrowthSlowing | $WMT - wmt comps

The more telling visual is the earnings per share (EPS) miss. In 11 years, Wal-Mart has only missed 12 times, and nine of those were by a penny. Today it missed by a nickel. That's only happened once before – in 2007.

The blue bars in this chart show the absolute EPS variance to consensus for each quarter. The dots refer to the right axis showing the percent beat or miss in each period. Not a good way to start things off in the first quarter for new CEO Doug McMillon.

Hedgeye Retail: Wal-Mart Plays Right Into #GrowthSlowing | $WMT - wmt2 

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Editor's Note: This research note was originally sent to subscribers on May 15, 2014 at 8:36 a.m. EST by Hedgeye Retail sector head Brian McGough. Follow Brian on Twitter @HedgeyeRetail.

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