Key Points
Walmart has multiple AI opportunities.
The giant retailer's AI initiatives should reduce costs and boost earnings, driving its share price higher.
However, several obstacles could prevent Walmart from delivering a 75% gain over the next five years.
Dividend stocks are boring. At least, that's what many investors think. However, quite a few dividend stocks offer a fair amount of excitement. Some are even members of the elite group of stocks known as Dividend Kings, which have increased their dividends for at least 50 consecutive years.
I believe that Walmart (NYSE: WMT) is arguably one of the most exciting Dividend Kings of all. And this retail stock could surge 75% by 2030, thanks to artificial intelligence (AI) innovation.
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Walmart's AI opportunities
Walmart is already using AI extensively in its operations. For example, the company has used AI to support voice shopping for several years. It has used chatbots in customer service since 2020 and introduced more powerful generative AI functionality last year.
More recently, Walmart announced new AI tools for its employees in June 2025. These tools include the ability to translate different languages in real time and help with shift planning. The company has also launched AI agents to help associates and shoppers.
Spatial AI is another major focus for Walmart. This technology enables the creation of digital twins of Walmart's stores and Sam's Club warehouses. The company uses these digital twins to detect and address issues in its buildings before they become major problems.
Logistics and warehousing are obvious targets for using AI. Walmart has teamed up with warehouse robotic systems innovator Symbotic (NASDAQ: SYM) to deploy robotic systems in its regional distribution centers. The company also developed its own robotics technology, but sold its Advanced Systems and Robotics business to Symbotic earlier this year.
How this Dividend King could soar 75% by 2030
To soar 75% by 2030, Walmart needs to deliver a compound annual growth rate (CAGR) of a little under 12%. How can the giant retailer pull off that kind of growth? AI should help.
Walmart's partnership with Symbotic paves the way to automate 65% of its stores and 55% of its order processing centers by the end of fiscal year 2026. This should reduce both labor and logistics costs.
Spatial AI is already paying off handsomely for the company. Walmart's use of digital twins technology powered by spatial AI has helped it cut maintenance spending related to refrigeration by 19%.
The AI tools that Walmart is providing to its employees will improve productivity. For example, the company expects that shift planning time will drop from 90 minutes to only 30 minutes.
Walmart's AI functionality for customers should increase basket size, driving higher revenue. The use of machine learning to evaluate competitor pricing and market trends could also help the company set prices that attract customers while maximizing gross margins.
Growing by 75% in five years isn't too much of a stretch for Walmart, by the way. Its stock has skyrocketed close to 120% over the last five years.
What could get in the way?
However, Walmart delivering a 75% gain by 2030 isn't a slam dunk. Several obstacles could get in the way.
For one thing, Walmart's valuation could become an issue. The stock's forward price-to-earnings ratio is 33.7. That's higher than some fast-growing tech stocks. Granted, Walmart arguably deserves a premium multiple. However, it's nonetheless possible that some investors could be reluctant to buy shares because of valuation concerns.
A stock market correction is another real risk. There's no guarantee that the current bull market will continue its momentum over the next five years. The good news is that Walmart typically holds up better than most stocks during a market downturn. And if the economy nosedives, it's one of the most recession-resistant stocks around.
Finally, Walmart faces deep-pocketed competition. Amazon (NASDAQ: AMZN) is an especially formidable rival in the e-commerce space. It's possible that Walmart won't be able to grow as much through 2030 as it has in recent years because of stiffer competition.
Despite these potential issues, Walmart should have a pretty good chance of surging 75% by the end of the decade. If the company's AI initiatives yield better-than-anticipated results, that projection could be too pessimistic.
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Keith Speights has positions in Amazon. The Motley Fool has positions in and recommends Amazon, Symbotic, and Walmart. The Motley Fool has a disclosure policy.
