Sep 22, 2022 (PressReach.com via COMTEX) -- The company is positioned to increase market share over the next two to three years by leveraging its grocery delivery and pick-up businesses. Walmart stock was looking solid in early trading on Wednesday.
Despite worries about consumer spending, KeyBanc Capital Markets is optimistic about retail giants Walmart Inc. /zigman2/quotes/207374728/composite WMT -0.52% and Target Corporation /zigman2/quotes/207799045/composite TGT -0.83% ahead of the holiday season on the theory that both businesses will gain more market share.
“While investors can identify smaller companies with greater growth potential, we believe both Walmart and Target are on the greatest competitive footing of the past decade,” said analyst Bradley Thomas. “Given the pandemic’s driver of e-commerce becoming much more prominent.”
The company began covering WMT and TGT with an Overweight rating due to their defensive growth, improving margins, and ongoing e-commerce performance. Both retailers reportedly had successful back-to-school seasons. The company set a price objective of $155 for WMT, implying a potential gain of more than 14%, and $200 for TGT, implying a potential gain of more than 20%.
In other places, AlixPartners predicted an increase in Christmas retail sales of 4.0% to 7.0%, with digital and affordability being two of the major themes. Despite the fact that the growth rate is lower than anticipated given the pressures of inflation on the American consumer, KeyBanc believes that Walmart (wmt:NYSE) and Target /zigman2/quotes/207799045/composite TGT -0.83% outperform their sector counterparts given the macroeconomic environment.
After losing 2.06% on Tuesday, Walmart (wmt:NYSE) increased by 0.61% in Wednesday’s premarket trade. Following a loss of 4.38% on Tuesday, Target Corporation /zigman2/quotes/207799045/composite TGT -0.83% increased by 0.75%.
Walmart stock WMT, +0.25%, and Target Corp. TGT, +0.64%, according to KeyBanc Capital Markets analysts , appear to be well-positioned to weather the current economic environment and increase profit margins. With overweight ratings and price targets of $155 and $200, respectively, KeyBanc analysts started covering Walmart stock and Target stock. Given the pandemic’s driver of e-commerce becoming considerably more prominent, KeyBanc analyst Bradley B. Thomas said, “Investors can find stronger growth prospects in smaller firms, but we feel both Walmart and Target are in the greatest competitive stance of the past decade.” The two companies are also well-positioned to increase their market share over the next two to three years as they capitalize on their grocery delivery and pickup operations. Analysts anticipate that the profit margins will return to normal levels. Walmart stock is down 6.6% in 2022 compared to the S&P 500 SPX, +0.40%’s loss of 17.5%. In 2022, Target’s stock has decreased by 28.2%.
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