Based in Bentonville, Arkansas, Walmart Inc. (WMT) operates retail, wholesale, other units, and eCommerce worldwide. Valued at $561.36 billion by market cap, the world’s largest retailer operates supercenters, supermarkets, hypermarkets, warehouse clubs, cash and carry stores, and discount stores in 19 countries under the Walmart and Walmart Neighborhood Market brands. It also operates membership-only warehouse clubs, e-commerce websites such as walmart.com.mx, Walmart.ca, flipkart.com, PhonePe, and others, and mobile commerce applications.
The omnichannel retailer giant has outperformed the broader market considerably over the past year. WMT has gained 31.2% over this time frame, while the S&P 500 Index ($SPX) has risen 19%. In 2024, WMT stock is up 32.5%, compared to SPX’s 14.2% returns on a YTD basis.
Zooming in further, WMT’s gains over the past 52 weeks easily overshadow the S&P 500 Cons Staples Sector SPDR (XLP). The exchange-traded fund has gained 4.5% over the past year, significantly underperforming WMT’s gains for the period. The stock’s YTD returns easily outshine the ETF’s 9.7% gains.
On May 16, WMT shares rose more than 7% after the company reported its Q1 results. Its U.S. comparable sales rose 3.9%, beating analyst expectations of a 3.15% rise. Driven by pickup and delivery services and a robust marketplace, its online sales rose 22%, much higher than the 17% growth witnessed during the holiday season. The company’s adjusted EPS of $0.60 beat the consensus estimates of $0.52. Moreover, its revenue of $161.50 billion exceeded Wall Street expectations of $158.10 billion.
For the full year, the retailer now expects annual consolidated net sales to rise at the high end or slightly above its prior forecast of 3% to 4% growth and adjusted profit per share to be at the high end or slightly above its prior estimate of $2.23 and $2.37.
For the current fiscal year, ending in January, analysts expect WMT to report an EPS growth of 9.5% to $2.43 on a diluted basis. The company’s earnings surprise history is impressive. It beat or matched the consensus estimate in each of the last four quarters.
Among the 31 analysts covering WMT stock, the consensus rating is a “Strong Buy.” That’s based on 24 “Strong Buy” ratings, four “Moderate Buys,” and three “Holds.”
This configuration is slightly more bullish than three months ago, with 21 suggesting a “Strong Buy.”
Recently, BMO Capital analyst Kelly Bania maintained the “Outperform” rating on WMT stock and raised the price target from $75 to $80, implying a potential upside of 14.6% from current levels.
The mean price target of $73.43 represents a 5.2% premium to WMT’s current price levels. The Street-high price target of $82 suggests an ambitious upside potential of 17.5%.
On the date of publication, Dipanjan Banchur did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
