Bentonville, Arkansas-based Walmart Inc. (WMT) operates discount stores, supercenters, and neighborhood markets. With a market cap of $620.7 billion, the company offers apparel, housewares, small appliances, electronics, musical instruments, books, home improvement, shoes, jewelry, toddlers' games, household essentials, pets, pharmaceutical products, party supplies, and automotive tools.
Companies worth $200 billion or more are generally described as “mega-cap stocks,” and WMT definitely fits that description, with its market cap exceeding this threshold, reflecting its substantial size, influence, and dominance in the discount stores industry. Through innovation, Walmart strives to continuously improve a customer-centric experience that seamlessly integrates its e-commerce and retail stores in an omnichannel offering that saves time for customers, making it the world’s largest retailer.
Despite its notable strengths, Walmart slipped marginally from its 52-week high of $77.81, achieved on Sep. 3. Over the past three months, WMT stock gained 16%, outperforming the Consumer Staples Select Sector SPDR Fund’s (XLP) 7.1% gains during the same time frame.
In the longer term, shares of Walmart rose 47% on a YTD basis and climbed 43.4% over the past 52 weeks, outperforming XLP’s YTD gains of 15.9% and 15.7% returns over the last year.
To confirm the bullish trend, WMT has mostly traded above its 50-day and 200-day moving averages since early January, with slight fluctuations recently.
WMT's overall performance can be attributed to its investments in store remodels, new stores, automation, and artificial intelligence to drive long-term growth. The retailer's focus on offering low prices and technology integration has kept it ahead of competitors. The recent launch of Walmart+ has led to a significant increase in e-commerce revenue, driven by convenience-seeking members. Besides, the acquisition of TV brand Vizio and adding higher-end brands like Reebok and Chaps demonstrate WMT's commitment to expanding its offerings.
Moreover, on Aug. 15, WMT shares closed up more than 6% after reporting its Q2 results. Its adjusted EPS of $0.67 topped Wall Street expectations of $0.65. The company’s revenue was $169.3 billion, topping Wall Street forecasts of $168.5 billion.
Walmart’s rival, Costco Wholesale Corporation (COST), lagged behind the stock, with 34.8% returns on a YTD basis. However, COST outperformed the stock with 63.5% gains over the past 52 weeks.
Wall Street analysts are highly bullish on Walmart’s prospects. The stock has a consensus “Strong Buy” rating from the 32 analysts covering it, and the mean price target of $79.65 suggests a potential upside of 3.1% from current price levels.
On the date of publication, Neha Panjwani 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.
