Walmart Inc. (NYSE: WMT) could do no wrong over the last year. That was then. After seeing its shares effectively double from the end of 2023 to the peak seen in early 2025, Walmart’s stock is now on the defensive and this looks like the most negative reaction since May of 2022.
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Now there is a question for strategic investing via fear and greed. Fear: should Walmart investors take their profits? Greed: should investors look at a 10% sell-off as a huge buying opportunity?
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First and foremost, Walmart did see a significant multiple expansion in 2024. The world’s largest retailer saw revenue growth in the last year of 5.6% with operating income up 9.7% on a constant currency basis. And Walmart’s 13% dividend hike was the largest percentage gain in over a decade. And in the all-important Christmas quarter, Walmart’s global eCommerce sales grew by 16%.
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For fiscal year 2026, Walmart has guided for net sales to rise 3% to 4% and for adjusted operating income to rise 3.5% to 5.5% on a constant currency basis — with adjusted earnings per share projected to be $2.50 to $2.60 (EPS) for the year ahead. At a $105 share price in the days ahead of earnings, that would be 41-times earnings at the mid-point. At a $95 share price that’s still at 38-times expected earnings. If Walmart’s stock doubled and if the above growth metrics are backed out, investors are paying a significantly higher multiple now than they were a year ago.
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Amazon.com Inc. (NASDAQ: AMZN) is valued at close to 35-times its projected EPS and Costco Wholesale Corporation (NASDAQ: COST) is valued at close to 55-times forward earnings. The caveats here on a relative valuation is that all three companies have different fiscal year-end dates. Walmart also had its notorious 3-for-1 stock split in the 2024 as well.
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So, what is Wall Street saying? Some analysts were cautious, and some have increased their price targets. One issue to consider is that analysts had already raised their price targets in the days and weeks ahead of the earnings report. Here is what was readily available as of Friday morning:
BofA (Buy) target reiterated as $120, after being raised from $110 earlier in February and $105 in January
Guggenheim (Buy) and target raised to $110 from $100
JPMorgan (Overweight) and target reiterated as $112, after having been raised from $97 earlier in the month
KeyBanc (Overweight) and target raised to $105 from $100
Morgan Stanley (Overweight) target reiterated as $115
Piper Sandler (Buy) and target Cut to $114 from $118, after having been raised from $93 a week earlier
Telsey Advisory (Outperform) and target reiterated as $115, after having been raised from $105 a week earlier
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What about the independent research firms? CFRA (S&P) reiterated its Buy rating and reiterated its $114 price target. And a week ahead of the report, the independent research firm Argus reiterated its Buy rating and raised its target to $115 from $100.
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Please note — All price targets and analyst ratings featured in this report have been issued by the firms named above. Oggonomics does not maintain formal price targets or ratings of its own on Walmart.
