Stockchase Opinions

The Weekly Buzzing Stocks by Billy Kawasaki Walmart Inc WMT-N TOP PICK Apr 03, 2025

Walmart today is a people-led, tech-powered omnichannel retailer dedicated to helping people save money and live better. Since Sam Walton opened the first Walmart, we have opened thousands of stores across the U.S. and internationally. Around the world, customers want the same things: value, a broad assortment of quality items and services, a convenient and enjoyable shopping experience, and to do business with a company they trust. We are on a mission to meet our customers and members wherever they are, with the things they want, where and how they want them. And although the ways we deliver these experiences is changing, and changing fast, our promise to improve the customer and associate experience is constant. Social media mentions are up 188% in the past 24h.

$88.330

Stock price when the opinion was issued

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BUY

They will survive this tariff war, because their sourcing of products is so great.

SELL

Tariffs aren't in place at this point. Tariff talks are coming up this weekend, and things can change on a dime. A year from now, he doesn't see tariffs in place at the levels first announced. Worries on that front are premature.

Technically, the stock is great -- higher highs, higher lows. Valuation's up there at 38x forward PE, for 7-7.5% earnings growth. Expensive at over 5x PEG.

COMMENT
Should Walmart "eat the tariffs," as Trump says?

It would be terrific if Walmart operated as a charity by subsidizing its customers. Problem is retailers have incredibly low profit margins to begin with. Also, they couldn't plan ahead, but nobody knew these tariffs were coming. When they did know, they did their best shifting to sourcing products  from countries that had the lowest tariffs. But you can't change your entire supply chain overnight. Given their huge scale, WMT negotiate the best deal with their suppliers, and have tried not to raise prices that much for customers. They will certainly lose money on some products. Walmart should be the last company on Earth to be singled out for profiteering. 

COMMENT
Should Walmart "eat the tariffs," as Trump says?

It would be terrific if Walmart operated as a charity by subsidizing its customers. Problem is retailers have incredibly low profit margins to begin with. Also, they couldn't plan ahead, but nobody knew these tariffs were coming. When they did know, they did their best shifting to sourcing products  from countries that had the lowest tariffs. But you can't change your entire supply chain overnight. Given their huge scale, WMT negotiate the best deal with their suppliers, and have tried not to raise prices that much for customers. They will certainly lose money on some products. Walmart should be the last company on Earth to be singled out for profiteering. 

Unspecified

It is well run and the business should do well. Given tariffs, shipping costs, and the potential decline of the U.S. dollar, profitability may go down. It is buying back stock but he is not waiting for a disconnect. At 30X earnings it is quite expensive.

BUY

Hard not to like. Great job on e-commerce, after having lagged. Now has a lovely hybrid model of in-store and online. Very price competitive. Well-positioned structurally for the long term. Massive importer of goods, so tariffs are a pressure. Valuation's not cheap, but it never is. Buy and forget about it.

BUY
Research based on Bob Lang of Explosiveoptions.net

Has been rangebound within $93-100, but is digesting after a big move up after April. The Chaykin Money Flow remains positive. The MACD line made a bullish crossover Lang suggests buying ahead of next month's report. Lang targets $105-110 and he agrees.

DON'T BUY

It's too expensive considering its growth. A good company, but 55% of their business is low-margin groceries.

BUY

They trade at 40x PE because they are capturing market share and traffic, and have earnings and revenues growth. Their biggest risk is in groceries from Amazon who want to build out that business. WMT price momentum will continue until there's a weak quarter.

HOLD

Iconic brand, as well as scale and efficiency. You could say it's quite expensive. On the other hand, what a moat. Could very well keep chugging along without having its multiple fall. Very profitable, lots of FCF to buy back shares or whatever. Nearest competitor is TGT, which is not doing well. Perhaps TGT's loss is WMT's gain.