17 Nov

How Analysts Reacted to Walmart’s Strong 3Q Results

WRITTEN BY Amit Singh

Several analysts raised their target prices

Walmart (WMT) reported strong fiscal 3Q18 results, and several analysts raised their target prices for the stock. Jefferies increased its target price to $110 from $105 and maintained a “buy” rating. KeyBanc raised its target price to $112 from $100 and maintained an “overweight” recommendation. Telsey Advisory Group recommended an “outperform” rating and raised its price target to $108 from $96. RBC Capital, which has an “underperform” rating on WMT stock, also raised its target price to $92 from $83.

How Analysts Reacted to Walmart’s Strong 3Q Results

Given the surge in WMT stock on November 16, 2017, the stock is now trading 3.4% above analysts’ 12-month target price of $96.21 per share.

Rating summary

Walmart is expected to continue to generate healthy sales due to improvement across all its business segments. Its digital business is estimated to grow at a rapid rate and, in turn, support its top-line growth. Fresh offerings, supply-chain reinvention, and in-store activity are projected to drive the company’s top-line and bottom-line growth.

However, increased price investments and a growing digital mix for overall sales are expected to hurt its margins.

About 47% of analysts covering WMT stock are recommending a “buy,” and an equal number are suggesting a “hold.” About 6% of analysts have given the stock a “sell” rating.

In comparison, most of the analysts are recommending a “hold” for Target (TGT) stock, and most of the analysts are suggesting a “buy” for Costco (COST) stock.

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