NEW YORK (CNN/Money) - Wal-Mart Stores Inc. reported improved earnings Wednesday in line with its recently raised guidance for the fiscal second quarter.

The world's largest retailer earned $2.3 billion, or 52 cents a share, from continuing operations in the quarter ended July 31, up from $2 billion, or 45 cents a share, on the same basis a year earlier. Analysts surveyed by earnings tracker First Call raised their forecast for the quarter to 52 cents from 50 when the company reported better-than-expected July sales last week.

Sales rose 11.3 percent to $62.6 billion, while sales at U.S. stores open at least a year, a closely watched retail measure known as same-store sales, increased 3.2 percent for the quarter.

In a prerecorded call, Wal-Mart president and CEO Lee Scott said markdowns in the quarter were higher than normal but were offset by higher sales in the specialty and food divisions.

In the second quarter, the Wal-Mart Stores segment, including Supercenters, had operating profit of $3.317 billion, an increase of 9.3 percent from the $3 billion for the same period in the previous year.

The Sam's Club division logged operating profit for the quarter of $309 million, an increase of 12.8 percent, compared with $274 million for the similar period in the previous year.

For the first half, sales at the Wal-Mart division rose 2.7 percent, while sales at the Sam's Club business increased 3.0 percent.

Looking ahead, the retailer said it expects to benefit from easier comparisons in the second half of the year, "although the environment remains challenging."

For the third quarter, Wal-Mart forecasts earnings of 45 to 47 cents a share, a penny better than analysts' consensus estimate of 46 cents a share, according to First Call. The company also said it expects full-year 2004 earnings to be at the higher end of its forecast of $2 to $2.05 a share.

First Call's full-year 2004 estimate is $2.04 a share.

Wal-Mart expects sales in August to grow 3 to 5 percent and third-quarter sales to increase 3 to 5 percent.

"Wal-Mart continues to show strong momentum and operating performance," said Bill Dreher, analyst with Deutsche Bank Securities. "Its food and apparel sales did well, which fits in with our thesis that Wal-Mart is really taking on the supermarkets. By adding new apparel name brands like Levi's, I think it's in a position to see tremendous success in apparel too."

Added Dreher, "Wal-Mart's management is rather conservative, but it sounds upbeat about the future. I'm very confident that if the economy improves, the company could surpass its own guidance for the rest of the year."

Dreher has a "buy" rating on Wal-Mart and a $65 price target on the stock.

Shares of Bentonville, Ark.-based Wal-Mart (WMT: Research, Estimates), a component of the Dow Jones industrial average, gained $1.10 to $58.80 Tuesday.  

--Analysts quoted in the story do not own Wal-Mart shares and their firms do not have an investment banking relationship with the company.