We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Walmart Hovers Around an All-Time High: Can ETFs Soar Higher?
Read MoreHide Full Article
America's largest retailer, Walmart (WMT - Free Report) , is garnering Wall Street's attention with its impressive stock performance. The company's stock reached a record closing high of $162.61 per share on Aug 31. While it began September near its all-time high, it slightly retreated at the close on Sep 1. Year-to-date, Walmart shares have surged more than 13%, outperforming peer Target stock (TGT - Free Report) , which has fallen almost 16% (as of Sep 1, 2023).
Groceries: Walmart's Winning Strategy
As inflation continues to affect consumers' budgets, Walmart's expansion in and more focus on the grocery business has proved a winning strategy. This strategic move has enabled Walmart to establish a foothold with customers, leading them to explore broader discretionary purchases.
LSEG Director of Consumer Research, Jharonne Martis, highlighted Walmart's edge over Target, stating, "They've gained those loyal customers because of groceries, and now that's converting into them extending themselves and buying general merchandise," as quoted on Yahoo Finance.
Analysts' Optimism and Insights
Walmart's second-quarter earnings results underscore its success. The company reported a 6.3% increase in same-store sales, surpassing the anticipated 4.04%. Foot traffic also rose by 2.8%, accompanied by higher average transaction values and increased online sales during the quarter.
Wall Street experts suggest that Walmart's momentum might continue into the fall. Goldman Sachs analyst Kate McShane highlighted improving trends in general merchandise and ongoing market share gains across income groups.
Walmart's size and influence have a ripple effect on the industry, as its actions often become a trend-setter. Despite this, the company has not shown signs of aggressive price changes. So, we can conclude that Walmart’s future profits will likely be volume-driven, not price-driven.
What Does the Broker Rating Say?
Based on short-term price targets offered by 31 analysts, the average price target for Walmart comes to $177.55. The forecasts range from a low of $163.00 to a high of $210.00. The average price target represents an increase of 9.19% from the closing price of $162.61 on Sep 1, 2023.
Walmart currently has an average brokerage recommendation (ABR) of 1.45 on a scale of 1 to 5 (Strong Buy to Strong Sell), calculated based on the actual recommendations (Buy, Hold, Sell etc.) made by 30 brokerage firms. The current ABR compares to an ABR of 1.50 a month ago based on 27 recommendations.
Of the 30 recommendations deriving the current ABR, 21 are Strong Buy and four are Buy. Strong Buy and Buy respectively account for 70% and 13.33% of all recommendations. A month ago, Strong Buy made up 66.67%, while Buy represented 14.81%.
The ABR of 1.45 is upbeat compared with 1.69 ABR held by the underlying industry and 9.99 ABR held by the S&P 500.
How Are Walmart’s Future Prospects?
The company has a Zacks Rank #2 (Buy) and it has an upbeat Growth Score of “A” and a Value score of “B”. Walmart’s expected growth rate for current year and upcoming year, however, fall short of the Retail – Supermarkets industry.
Hence, investors who fear about this below-industry growth rate of Walmart, may play the stock via basket approach. In this way, investors will get a chance to play the entire Retail – Supermarkets industry which also has an upbeat Zacks rank.
Image: Bigstock
Walmart Hovers Around an All-Time High: Can ETFs Soar Higher?
America's largest retailer, Walmart (WMT - Free Report) , is garnering Wall Street's attention with its impressive stock performance. The company's stock reached a record closing high of $162.61 per share on Aug 31. While it began September near its all-time high, it slightly retreated at the close on Sep 1. Year-to-date, Walmart shares have surged more than 13%, outperforming peer Target stock (TGT - Free Report) , which has fallen almost 16% (as of Sep 1, 2023).
Groceries: Walmart's Winning Strategy
As inflation continues to affect consumers' budgets, Walmart's expansion in and more focus on the grocery business has proved a winning strategy. This strategic move has enabled Walmart to establish a foothold with customers, leading them to explore broader discretionary purchases.
LSEG Director of Consumer Research, Jharonne Martis, highlighted Walmart's edge over Target, stating, "They've gained those loyal customers because of groceries, and now that's converting into them extending themselves and buying general merchandise," as quoted on Yahoo Finance.
Analysts' Optimism and Insights
Walmart's second-quarter earnings results underscore its success. The company reported a 6.3% increase in same-store sales, surpassing the anticipated 4.04%. Foot traffic also rose by 2.8%, accompanied by higher average transaction values and increased online sales during the quarter.
Wall Street experts suggest that Walmart's momentum might continue into the fall. Goldman Sachs analyst Kate McShane highlighted improving trends in general merchandise and ongoing market share gains across income groups.
Walmart's size and influence have a ripple effect on the industry, as its actions often become a trend-setter. Despite this, the company has not shown signs of aggressive price changes. So, we can conclude that Walmart’s future profits will likely be volume-driven, not price-driven.
What Does the Broker Rating Say?
Based on short-term price targets offered by 31 analysts, the average price target for Walmart comes to $177.55. The forecasts range from a low of $163.00 to a high of $210.00. The average price target represents an increase of 9.19% from the closing price of $162.61 on Sep 1, 2023.
Walmart currently has an average brokerage recommendation (ABR) of 1.45 on a scale of 1 to 5 (Strong Buy to Strong Sell), calculated based on the actual recommendations (Buy, Hold, Sell etc.) made by 30 brokerage firms. The current ABR compares to an ABR of 1.50 a month ago based on 27 recommendations.
Of the 30 recommendations deriving the current ABR, 21 are Strong Buy and four are Buy. Strong Buy and Buy respectively account for 70% and 13.33% of all recommendations. A month ago, Strong Buy made up 66.67%, while Buy represented 14.81%.
The ABR of 1.45 is upbeat compared with 1.69 ABR held by the underlying industry and 9.99 ABR held by the S&P 500.
How Are Walmart’s Future Prospects?
The company has a Zacks Rank #2 (Buy) and it has an upbeat Growth Score of “A” and a Value score of “B”. Walmart’s expected growth rate for current year and upcoming year, however, fall short of the Retail – Supermarkets industry.
Hence, investors who fear about this below-industry growth rate of Walmart, may play the stock via basket approach. In this way, investors will get a chance to play the entire Retail – Supermarkets industry which also has an upbeat Zacks rank.
ETFs in Focus
VanEck Retail ETF (RTH - Free Report) ) – Walmart has 8.58% Exposure
Vanguard Consumer Staples ETF (VDC - Free Report) ) – Walmart has 7.83% Exposure
iShares U.S. Consumer Focused ETF (IEDI - Free Report) ) – Walmart has 5.83% Exposure