Top Retail Stocks Resilient Amid 20-Year E-Commerce Surge
The past two decades have posed significant challenges for retail stocks. The surge in e-commerce platforms, a decline in traditional malls, changing consumer preferences, and two recessions led many brick-and-mortar retailers to bankruptcy. However, the so-called “retail apocalypse” did not hinder the progress of the most resilient companies. This article examines three such retailers: Kroger (NYSE: KR), Walmart (NYSE: WMT), and Amazon (NASDAQ: AMZN), exploring why their future looks promising over the next two decades.
Kroger’s Solid Growth Trajectory
Kroger’s stock has soared approximately 815% over the last 20 years. From fiscal 2004 to fiscal 2024, which ended in February 2025, the company’s revenue experienced a compound annual growth rate (CAGR) of 5%. Its year-end store count increased from 2,532 to 2,722.
Now the largest supermarket operator in the U.S. by annual revenue, Kroger also manages numerous other banners, such as Fred Meyer, Ralphs, Dillons, Fry’s Food Stores, King Soopers, and Baker’s. A proposed $24.6 billion merger with Albertsons fell through due to antitrust concerns in late 2024.
Kroger’s consistent growth can be attributed to several factors. The company has strengthened its digital and loyalty programs, introduced more private label products, and expanded its advertising and health services segments. Its scale provides it with resilience against inflation and other macroeconomic challenges, setting it apart from smaller competitors. Furthermore, it aims to offset the effects of tariffs by diversifying its supplier base and optimizing supply chains.
Currently, Kroger appears attractive at 15 times forward earnings with a forward yield of 1.8%. Notably, it has increased its dividend for 18 consecutive years, making it a strong retail option for steady growth over the next two decades.
Amazon: A Retail Giant’s Evolution
Amazon’s stock has surged 11,630% over the last two decades. Its revenue registered a CAGR of 25% from 2004 to 2024. Initially focused on selling books, Amazon transformed into a vast online superstore, now recognized as the world’s largest e-commerce company. It also launched Amazon Web Services (AWS), which has since become a dominant player in cloud infrastructure.
AWS generates higher-margin revenue compared to Amazon’s e-commerce sector, fueling the expansion of Amazon Prime’s offerings, including discounted services and enhanced digital features. This growth allows Amazon to strengthen its market position against brick-and-mortar competitors and mitigate potential tariff impacts.
Although Amazon faces increased competition from budget-friendly Chinese platforms like PDD‘s Temu and Shein, many of these merchants also sell on Amazon. The company continues to expand its grocery delivery services, digital media, and Whole Foods locations, while solidifying consumer loyalty through Prime subscriptions and Alexa-enabled devices.
With over 200 million Prime members globally, Amazon is well-positioned to take advantage of growth in the cloud and AI sectors. Currently trading at 28 times forward earnings, it presents an appealing investment opportunity for the next two decades.
Walmart’s Continued Dominance
Walmart’s stock has increased approximately 520% over the last 20 years. From fiscal 2005 to fiscal 2025, which concluded in January, the company’s revenue grew at a CAGR of 9%. Its store count expanded from 6,857 to 10,660, including Sam’s Club and various regional banners as well as international e-commerce platforms.
The company survived industry challenges by renovating stores, expanding its e-commerce capabilities, and utilizing its extensive physical store network for online order fulfillment. Additionally, Walmart effectively matched Amazon’s pricing and developed its Walmart+ subscription service as a competitive response to Amazon Prime.
As the largest brick-and-mortar retailer in the U.S., Walmart’s significant scale and diversification help it endure economic downturns. In terms of tariffs, Walmart can leverage its size to negotiate favorable pricing with international suppliers or shift sourcing to lower-tariff regions. Gradually increasing prices to offset costs is also within its strategy.
Walmart is expected to maintain its market leader position in retail over the next two decades. Although it offers a modest forward yield of 1%, it is classified as a Dividend King, having raised dividends for 52 consecutive years. The company’s favorable payout ratio allows room for additional increases, solidifying Walmart as a top choice for long-term investors.
Investment Considerations for Kroger
Before investing in Kroger stock, consider the following:
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John Mackey, the former CEO of Whole Foods Market, which is owned by Amazon, serves on The Motley Fool’s board of directors. Leo Sun holds positions in Amazon. The Motley Fool has investments in and recommends Amazon and Walmart, while also recommending Kroger. Disclosure policies are available for review.
The views and opinions expressed herein are those of the author and do not necessarily reflect the views of Nasdaq, Inc.
