Zacks Investment Research Upgrades Wal-Mart Stores (WMT) to Buy

Wal-Mart Stores (NYSE:WMT) was upgraded by Zacks Investment Research from a “hold” rating to a “buy” rating in a note issued to investors on Saturday. The brokerage currently has a $114.00 price target on the retailer’s stock. Zacks Investment Research‘s price target indicates a potential upside of 13.02% from the stock’s previous close.

According to Zacks, “Wal-Mart Stores, which recently announced plans to drop the “hyphen” and “stores” from its name to officially emerge as an omnichannel retailer, has surpassed the industry in a year. The company has been riding on its robust past record, which derives strength from constant e-commerce initiatives, like buyouts, alliances, surging grocery business and improved delivery systems. Thanks to these trends, along with solid traffic, Walmart’s third-quarter fiscal 2018 marked its ninth and 13th straight quarter of positive earnings surprise and comps growth, respectively. Also, the company’s international business remains a growth driver. However, costs associated with technological and e-commerce investments; mix impact from growing e-commerce operations and a compelling pricing strategy have been hurting Walmart’s gross margin for a while now. Stiff competition and volatile consumer spending also pose threats.”

WMT has been the topic of a number of other reports. Goldman Sachs Group downgraded shares of Wal-Mart Stores from a “buy” rating to a “neutral” rating and set a $100.00 price objective on the stock. in a report on Monday, November 20th. They noted that the move was a valuation call. KeyCorp reiterated a “buy” rating and set a $90.00 target price on shares of Wal-Mart Stores in a research note on Tuesday, September 19th. Barclays reiterated a “buy” rating and set a $110.00 target price on shares of Wal-Mart Stores in a research note on Tuesday, November 21st. JPMorgan Chase & Co. reiterated a “neutral” rating and set a $84.00 target price (up from $80.00) on shares of Wal-Mart Stores in a research note on Friday, October 6th. Finally, Vetr cut Wal-Mart Stores from a “hold” rating to a “sell” rating and set a $91.97 target price on the stock. in a research note on Friday, November 17th. One investment analyst has rated the stock with a sell rating, eighteen have issued a hold rating, sixteen have given a buy rating and one has assigned a strong buy rating to the company. The stock presently has an average rating of “Hold” and a consensus target price of $97.16.

Wal-Mart Stores (NYSE:WMT) traded up $0.85 on Friday, reaching $100.87. 6,948,125 shares of the company’s stock were exchanged, compared to its average volume of 8,490,000. The company has a quick ratio of 0.19, a current ratio of 0.81 and a debt-to-equity ratio of 0.52. The stock has a market cap of $298,820.00, a P/E ratio of 26.83, a price-to-earnings-growth ratio of 3.68 and a beta of 0.37. Wal-Mart Stores has a 1 year low of $65.28 and a 1 year high of $102.35.

Wal-Mart Stores (NYSE:WMT) last posted its quarterly earnings data on Thursday, November 16th. The retailer reported $1.00 earnings per share (EPS) for the quarter, topping the Zacks’ consensus estimate of $0.97 by $0.03. The firm had revenue of $122.14 billion for the quarter, compared to the consensus estimate of $120.23 billion. Wal-Mart Stores had a net margin of 2.31% and a return on equity of 16.92%. The business’s revenue for the quarter was up 4.2% compared to the same quarter last year. During the same period in the previous year, the firm earned $0.98 EPS. sell-side analysts forecast that Wal-Mart Stores will post 4.43 EPS for the current fiscal year.

Wal-Mart Stores announced that its Board of Directors has initiated a share buyback plan on Tuesday, October 10th that permits the company to repurchase $20.00 billion in outstanding shares. This repurchase authorization permits the retailer to repurchase shares of its stock through open market purchases. Stock repurchase plans are generally a sign that the company’s board believes its stock is undervalued.

In related news, insider Jacqueline P. Canney sold 2,065 shares of the business’s stock in a transaction dated Monday, December 11th. The stock was sold at an average price of $96.99, for a total value of $200,284.35. Following the sale, the insider now directly owns 19,060 shares in the company, valued at approximately $1,848,629.40. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is available at this hyperlink. Also, SVP David Chojnowski sold 684 shares of the business’s stock in a transaction dated Friday, November 17th. The shares were sold at an average price of $99.29, for a total value of $67,914.36. The disclosure for this sale can be found here. Insiders sold a total of 12,419,588 shares of company stock worth $1,207,333,538 over the last 90 days. 51.39% of the stock is currently owned by company insiders.

A number of institutional investors have recently made changes to their positions in the stock. FMR LLC increased its position in shares of Wal-Mart Stores by 45.3% during the second quarter. FMR LLC now owns 17,982,372 shares of the retailer’s stock valued at $1,360,906,000 after buying an additional 5,608,785 shares during the period. Alliancebernstein L.P. increased its position in shares of Wal-Mart Stores by 42.6% during the second quarter. Alliancebernstein L.P. now owns 5,745,493 shares of the retailer’s stock valued at $434,819,000 after buying an additional 1,716,422 shares during the period. Parametric Portfolio Associates LLC increased its position in shares of Wal-Mart Stores by 52.9% during the second quarter. Parametric Portfolio Associates LLC now owns 4,883,390 shares of the retailer’s stock valued at $369,565,000 after buying an additional 1,689,364 shares during the period. Neuberger Berman Group LLC increased its position in shares of Wal-Mart Stores by 100.2% during the second quarter. Neuberger Berman Group LLC now owns 2,646,589 shares of the retailer’s stock valued at $200,294,000 after buying an additional 1,324,722 shares during the period. Finally, Old Mutual Global Investors UK Ltd. increased its position in shares of Wal-Mart Stores by 128.7% during the third quarter. Old Mutual Global Investors UK Ltd. now owns 2,058,798 shares of the retailer’s stock valued at $160,874,000 after buying an additional 1,158,519 shares during the period. Institutional investors and hedge funds own 30.58% of the company’s stock.

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About Wal-Mart Stores

Wal-Mart Stores, Inc is engaged in the operation of retail, wholesale and other units in various formats around the world. The Company operates through three segments: Walmart U.S., Walmart International and Sam’s Club. The Walmart U.S. segment includes its mass merchant concept in the United States operating under the Walmart or Wal-Mart brands, as well as digital retail.

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