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Walmart Takes Shopping Convenience to Next Level

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Walmart Takes Shopping Convenience to Next Level PART 2 OF 2

How Walmart’s Stock Has Performed Year-to-Date

Stock performance

Walmart (WMT) stock is up 15.1% on a YTD (year-to-date) basis as of September 22, 2017. The company hasn’t just outperformed most of its peers but has also generated higher returns than the S&P 500 (SPX-INDEX), which is up 11.8% during the same period. In comparison, stock prices of most of the company’s peers took a beating as investors shunned retailers amid growing threats from Amazon (AMZN).

Costco (COST), which has generated strong sales despite challenges, is up 4.8% on a YTD basis. Costco stock nosedived soon after Amazon announced the Whole Foods deal, as investors fear that Costco hasn’t done much on the digital side of the business and will be hit hard following the deal. However, three months after the deal, Costco continues to report industry-leading sales growth.

How Walmart’s Stock Has Performed Year-to-Date

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Meanwhile, Target (TGT) and Kroger (KR) stock continue to trade in the red and are down 18.3% and 41.6%, respectively, on a YTD basis.

Outlook

Walmart has reported healthy fiscal 1H18 results. Also, the company managed to grow its profitability during the first half of the current fiscal year.

Walmart’s continued business investments, especially in the digital arm, and innovative services to match Amazon have been popular with customers and have helped the company to generate incremental sales. Besides ease of shopping, Walmart’s value pricing and fresh offerings through efficient supply chain management are resulting in higher store traffic.

However, increased competition from online rivals and discount chains are expected to remain a drag and could dent its sales growth rate. Meanwhile, Walmart’s significant investments are projected to hurt margins in the coming quarters.

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