Walmart to acquire Vizio for $2.3 billion, sales outlook, dividend lift shares (updated)

Vizio Holding

20/02/2024 12:25

(Adds details, background)
       Feb 20 (Reuters) - Walmart  WMT.N  forecast fiscal 2025
sales above Wall Street expectations on Tuesday and said it
would buy smart-TV maker Vizio  VZIO.N  for $2.3 billion.
    Shares in the U.S. retail giant rose 3% in premarket trading
after it also announced its biggest dividend increase in more
than a decade. 
    Walmart proposed to buy Vizio for $11.50  per share, a
premium of 47% to the company's closing price of $7.82 as of
Feb. 12, the day before reports about deal talks emerged. Vizio
shares were up about 15% at $10.96 in premarket trading on
Tuesday.
     Americans flocked to Walmart's stores to buy its low-priced
and discounted products during the holiday season late last
year. However, still high interest rates and rising rents have
raised concerns that consumers will remain constrained and a
recovery in spending will be slower than previously expected.
    The retailer reported a 3.9% rise in comparable sales,
excluding fuel, for the fourth quarter ended Jan. 31, compared
to LSEG estimates of 2.91%. Global eCommerce sales grew 23%.
    Fourth quarter adjusted profit came in at $1.80 per share,
compared to expectations of $1.65 per share.
    Walmart said it expects consolidated net sales in fiscal
2025 to grow between 3% and 4%, largely above analysts'
expectations of a 3.4% rise. 
        The retailer raised its annual dividend by 9%.
    "This year’s 9% increase is the largest in over a decade,
and a sign of our confidence in our growth potential and cash
flow," said John David Rainey, executive vice president and
chief financial officer at Walmart Inc.
        

 (Reporting by Ananya Mariam Rajesh in Bengaluru and Siddharth
Cavale in New York; Editing by Susan Fenton)
 ((AnanyaMariam.Rajesh@thomsonreuters.com ; Twitter: https://twitter.com/AnanyaMariam;))