Most analysts remain on the sidelines
The majority of analysts remain on the sidelines for Walmart (WMT) stock. Walmart is expected to sustain the momentum in sales in coming quarters thanks to the expected growth in comps. Meanwhile, its e-commerce sales are likely to grow at a healthy rate, which in turn is expected to contribute meaningfully to its comps growth rate. Also, Walmart’s profit margins could improve sequentially in the coming quarters, reflecting growth in comps, cost-savings, and better e-commerce margins.
However, increased competition and the retailer’s investment in growth are expected to remain a drag. Target (TGT) continues to expand its digital offerings and match Walmart’s services. Meanwhile, Costco (COST) is focusing on widening the value gap with peers, which in turn is driving traffic. Also, Amazon (AMZN) is quickly expanding delivery through Whole Foods.
Rating and target price
Of the 32 analysts covering the stock, 17 analysts recommend a “hold,” and 15 analysts suggest a “buy.” Analysts have a consensus target price of $107 per share on WMT stock, which implies an upside of ~12% based on its closing price of $95.58 on February 8. Most of the Wall Street analysts also maintain a “hold” recommendation on Target Corporation. Meanwhile, analysts continue to have a favorable outlook on Costco (COST) stock.