Walmart Stock Nears Record Heights Amid Acquisition News
Walmart Inc. WMT shares are trading close to their 52-week peak, showing an increase of almost 14% this year. A significant factor contributing to this growth is the company’s recent purchase of Monroeville Mall in Pittsburgh for $34 million. However, recent trends suggest that investors should brace for a potential market correction.
Stock Performance Overview: The stock climbed to a new high of $102.58 during trading on Wednesday, just before the acquisition was publicized on Thursday.
At the end of Thursday’s trading, shares closed at $102.46. Indicators from Benzinga Pro pointed to a bullish trend, with the price significantly above key moving averages: a 200-day average of $77.99 and a 50-day average of $93.81. The eight-day and 20-day averages were also above $99.60 and $95.54 respectively, signaling strong momentum.
Despite the positive outlook, momentum metrics present a mixed picture. The MACD (moving average convergence/divergence) at 2.60 implies possible upward movement soon. However, the relative strength index at 79.66 indicates the stock may be overbought, suggesting a correction could happen soon.
Investor Activity in Q4: Recent 13F filings reveal insights from 2,036 investors as of Thursday, with more disclosures still to come for the quarter.
Notably, Jennison Associates LLC boosted its holdings by 6.86 million shares, marking a 37% increase, with an investment valued at $2.289 billion at the end of the fourth quarter. Similarly, Bank of New York Mellon Corporation added 3.927 million shares, raising its stake by 14%, bringing the firm’s total holdings to $2.893 billion as of December 31.
| Company | Holdings (as of Sept. 30) | Holdings (as of Dec. 31) | Change (in %) | Value As Of Dec. 31 |
| Bank of New York Mellon Corporation | 28.093 million | 32.020 million | 14% | $2.893 billion |
| Jennison Associates | 18.479 million | 25.339 million | 37% | $2.289 billion |
| Proficio Capital Partners LLC | 84,658 | 1.600 million | 1790% | $8.169 million |
| Allspring Global Investments Holdings | 1.621 million | 1.330 million | -18% | $119.718 million |
| Nordea Investment Management | 3.097 million | 2.517 million | -19% | $227.676 million |
| Abrdn Plc | 1.607 million | 1.484 million | -8% | $133.895 million |
Valuation Insights: Walmart’s stock appears to be trading at a higher valuation compared to its industry peers. With a forward price-to-earnings ratio of 37.175, it is 1.77 times more expensive than the industry average of 20.93. In contrast, Costco Wholesale Corp. COST stands out with a significantly higher forward P/E of 57.804, indicating a 2.76 times greater expense than its competitors.
| Stocks | Forward P/E |
| Walmart Inc. WMT | 37.175 |
| Costco Wholesale Corp. COST | 57.804 |
| Target Corp. TGT | 14.225 |
| Dollar General Corp. DG | 12.034 |
| Dollar Tree Inc. DLTR | 11.947 |
Recent Market Movement: In premarket trading on Thursday, WMT shares were up by 0.33%. Year-to-date, the stock has growth of 13.4%, while the S&P 500 ETF Trust SPY increased by 3.35% during the same time. In the past year, WMT has seen an impressive rise of 81.02%, compared to SPY’s 22.32% gain.
The consensus price target among 31 analysts tracked by Benzinga is $96.58, with a ‘buy’ rating. Projections vary from a low of $70 to a high of $115 per share. Recent assessments from Oppenheimer, Wells Fargo, and UBS suggest a more optimistic target of $110.33, indicating a potential upswing of 7.19%.
Next Steps:
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Overview Rating:
Speculative
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