6 reasons why investors should own Walmart

By Senad Karaahmetovic 

Credit Suisse analysts have initiated research coverage of the Food Retail and Hardline/Broadline Retail sectors with a Neutral rating. The balanced view on these two sectors is also reflected in the coverage of single stocks with only Walmart (NYSE:) and Tractor Supply (NASDAQ:) earning an Outperform rating.

The price target on Walmart stock is set at $170 per share, implying an upside potential of almost 20%. The analysts outlined 6 key reasons why they believe Walmart will outperform the market moving forwards.

1. Gaining meaningful market share since early 2021;
2. Well-positioned defensive name in an uncertain macro backdrop;
3. Price gaps to conventional grocers remain wide;
4. A potentially weak macro backdrop should accelerate share gains;
5. Well-positioned to be even more offensive than usual to gain share;
6. Alternative profit streams should continue to evolve and contribute to operating profits.

Some other major retailers, including Home Depot (NYSE:), Costco (NASDAQ:), Lowe’s (NYSE:), and Target (NYSE:), are Neutral-rated. On the other hand, Big Lots (NYSE:) is the only Underperform-rated stock.

“Our rating and target price are based on our view that BIG is at risk of significant share losses going forward and the company continuing to re-invent itself to remain relevant – but these reinventions have not proven to be successful to date,” the analysts said in a client note.