Walmart Inc. WMT continues to prove its resilience and dominance in the retail sector, delivering impressive stock performance against a dynamic macroeconomic backdrop. Over the past three months, the company’s shares have rallied 13%, surpassing the broader industry’s rise of 11.7%. The omnichannel giant has also surpassed the Zacks Retail – Wholesale sector’s growth of 11% and the S&P 500’s increase of 5.7% at the same time. This outperformance underscores Walmart’s robust strategies, operational excellence and ability to adapt to shifting consumer dynamics.

WMT Price Performance vs. Industry, S&P 500 & Sector

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Closing the trading session at $93.81 on Thursday, WMT stock stands just 2.5% shy of its 52-week high mark of $96.18 attained on Dec. 6, 2024. The company also trades above its 50 and 200-day moving averages, signaling strong upward momentum and price stability. The moving average is an important indicator for gauging market trends and momentum. This technical strength indicates positive market sentiment and confidence in the company's financial health and prospects. Let’s delve into Walmart’s growth drivers and explore its prospects as an investment opportunity.

What Powers Walmart's Dominance in Retail?

Walmart has been leveraging its expansive scale, digital transformation initiatives and focus on value to remain a preferred destination for cost-conscious shoppers. The company’s ability to combine everyday low prices with exceptional convenience remains central to its success. With an eye on top-line growth and efficiency, the company has demonstrated an ability to navigate economic uncertainty, inflationary pressures and evolving market conditions. 

Walmart has been benefiting from its omnichannel strategy, which seamlessly integrates online and in-store shopping. Initiatives like expanded curbside pickup, delivery services and the Sam’s Club “Just Go” checkout system demonstrate the company’s focus on enhancing customer convenience. This approach has been instrumental in attracting a diverse consumer base, with higher-income households now accounting for 75% of Walmart’s U.S. market share gains. Retail bellwethers such as Kroger KR, Target TGT and Costco COST are also advancing in omnichannel strategies, underscoring the industry’s pivot toward this model.

Walmart’s e-commerce operations remain a significant growth driver, with global online sales climbing 27% in the third quarter of fiscal 2025, fueled by expanded pickup and delivery options, a thriving marketplace and advanced supply-chain automation. These technological advancements have bolstered the company’s digital capabilities, strengthening its foothold in the competitive online retail space.

Apart from this, Walmart is diversifying its revenue streams through high-margin businesses, including advertising, membership programs and marketplace services. In the third quarter, Walmart Connect and international platforms like Flipkart drove a 28% rise in advertising revenues, while Walmart+ and Sam’s Club memberships achieved double-digit growth. These ventures not only enhance profitability but also deepen customer loyalty and engagement. Internationally, Walmart’s operations in key regions such as Mexico (Walmex), India (Flipkart and PhonePe) and China are vital components of its long-term growth strategy.

Is WMT Poised for Growth in FY25?

As Walmart continues to innovate and expand its offerings, its prospects remain strong, supported by its market leadership and ability to adapt to evolving consumer needs. For fiscal 2025, WMT expects consolidated net sales growth of 4.8-5.1% (at constant currency or cc). Adjusted operating income is expected to increase 8.5-9.25% at cc. Walmart expects adjusted earnings per share (EPS) for fiscal 2025 in the $2.42-$2.47 range. The guidance suggests growth from the adjusted EPS of $2.22 recorded in fiscal 2024.

Reflecting optimism around WMT’s prospects, analysts have upgraded their earnings estimates for the current fiscal year over the past seven days. 
 

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Find the latest EPS estimates and surprises on Zacks Earnings Calendar.

Walmart – From a Valuation Standpoint

While Walmart’s forward 12-month price-to-earnings (P/E) ratio of 34.35 exceeds the industry average of 31.09, this premium valuation underscores the market’s confidence in the company’s long-term growth potential and resilience. Investors are willing to pay a higher multiple for the company because of its robust business model, consistent performance and ability to navigate challenging macroeconomic conditions.

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Investing in Walmart: What You Need to Know

Walmart’s robust omnichannel strategy, e-commerce growth and diversification into high-margin businesses position it well for sustained success. Despite its premium valuation, the higher multiple reflects the market’s confidence in Walmart’s operational excellence, financial stability and ability to deliver value to shareholders. With a solid track record of navigating economic uncertainties, strong guidance for fiscal 2025, and ongoing innovations to enhance customer convenience and engagement, the company is well-equipped to capitalize on shifting consumer dynamics. 

As Walmart continues to evolve and expand its global footprint, it remains a compelling investment opportunity for long-term value creation. WMT currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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