By
Bhushan Akolkar
April 12th, 2024
Walmart (WMT) stock stays in the green zone as UBS analyst Michael Lasser placed an upgrade call at the retail giant’s shares. This call was inspired by the company’s recent upgrade in tech, enhanced productivity, and massive eCommerce sales.
A company’s potential to boost its revenue and its stock value depends on its ability to retain new customers with a viable strategy to add new ones. This goal is particularly more vital for retail-based companies like Walmart Inc (NYSE: WMT) that faces stiff competition in both their product offering and services. The company is stock is currently showing positive upticks trading at $121.23 with a 1.15% gain today. This positive performance comes after analysts at UBS Group AG (SWX: UBSG) upgraded Walmart stock on Monday, saying the company won new customers during the pandemic and established itself as the second major e-commerce player behind Amazon.com Inc (NASDAQ: AMZN).
Behind the Backdrop of UBS Upgrade for Walmart Stock
UBS analyst Michael Lasser upgraded Walmart stock from neutral to buy while forecasting the retail company’s share price to $130 from its current $120.99. This projection stems from UBS’ faith in Walmart’s accelerated technological development, enhanced productivity loop, and e-commerce scale.
Michael Lasser believes these three factors have the potential to give the company a massive boost. He believes:
“WMT offers the prospect of best-in-class consistency in an uncertain environment. We believe these elements will enable WMT’s shares to maintain a premium multiple, especially as the gap between the leaders and laggards in retail widens.”
Lasser also the company with its recent indices can see a share raise of more than $6 in the 2023 fiscal year.
What Else Is Walmart Doing Differently
Walmart has a long and rich history that dates back to 1962. It has a long haul growth process to establish itself as a formidable retailer in the United States, North America, and around the world. Walmart rose to become the largest retailer in the United States in 1990 but was overtaken by Amazon along the line. While the company delayed in evolving as a digitally powered retail company, it is doing things differently now as Lasser further noted that:
“WMT has done a lot right in recent years. It’s improved execution and successfully changed the narrative of its story from that of a mature brick-and-mortar retailer to being a viable #2 in e-commerce.”
The Long Haul to the Top
While generally being ranked a world’s top retail company ahead of Amazon by sales, it’s still a long haul for the company to rank high in terms of market capitalization. With a current market cap of $344.52 Billion, Walmart trails Amazon with a market cap of $1.34 Trillion.
For Walmart, a more ambitious stride would be to substantially increase its market cap which is a feat that can be achieved with retail growths that it’s experiencing and a little means to entice investors.