Is it a Good Time to Buy Walmart Stock at Its Current Price?

Walmart Inc. WMT continues to reinforce its standing as one of the most resilient and strategically positioned companies in global retail. The world’s largest retailer has evolved far beyond its traditional big-box roots, combining everyday low prices with a powerful omnichannel ecosystem, expanding high-margin revenue streams and disciplined cost execution. Reflecting this strength and investor confidence in its transformation, Walmart recently crossed the $1 trillion market capitalization milestone.

A Closer Look at WMT Stock’s Momentum

Unlike many consumer-facing companies grappling with demand volatility, Walmart continues to post steady traffic growth, supported by its value positioning and broad merchandise assortment. The company’s shares have delivered strong gains over the past year and recently hit a 52-week high of $131.79 on Feb. 9. 

Over the past year, Walmart shares have rallied 22.4%, outpacing the Zacks Retail – Wholesale sector’s decline of 0.5% and the S&P 500’s advance of 17.7%. The stock has also delivered stronger returns than key peers, with The Kroger Co. KR rising 3.4%, while Costco Wholesale Corporation COST and Target Corporation TGT declined 8.6% and 11.1%, respectively, over the same period.

Is WMT’s Premium Valuation Justified?

At present, Walmart trades at a forward price-to-earnings multiple of 42.93, slightly above the industry average of 39.81. The premium to Target and Kroger, which trade at 14.57 and 12.86, respectively, reflects Walmart’s scale, diversified revenue streams and consistent earnings profile. While Costco commands a higher multiple of 46.21, WMT’s valuation appears aligned with other large, high-quality retail operators. The stock’s multiple suggests that investors continue to place value on its stable demand base and long-term growth initiatives.

Growth Engines Driving Walmart’s Strength

Walmart continues to gain market share across grocery, general merchandise and health & wellness categories. Its price leadership resonates particularly well in uncertain environments, attracting both middle and higher-income shoppers seeking value. Grocery remains a critical traffic engine, driving recurring visits and reinforcing customer loyalty. Transaction counts and unit volumes have remained positive, demonstrating that demand is not merely price-driven but supported by relevance and convenience.

E-commerce is another powerful growth lever. Walmart’s digital sales continue to expand at a healthy pace, fueled by store-fulfilled delivery, curbside pickup and marketplace growth. The company’s integrated store network gives it a structural advantage, enabling faster delivery speeds and lower fulfillment costs relative to many competitors. Another major contributor is Walmart’s growing exposure to high-margin revenue streams. Advertising, through Walmart Connect and its broader retail media initiatives, has emerged as a meaningful profit engine. 

Membership income is also a stabilizing force. Sam’s Club continues to see healthy renewal rates and membership growth, while Walmart+ is expanding its subscriber base. Membership programs enhance customer stickiness, increase basket sizes and create recurring revenue streams. As these businesses scale, they contribute meaningfully to operating income growth.

International operations add another layer of strength. Markets such as Mexico and China continue to deliver solid performance, supported by digital adoption and format expansion. These regions provide long-term growth optionality and diversification beyond the U.S. consumer environment.

Operational discipline plays a key role. Walmart’s investments in automation, supply-chain modernization and data analytics are improving productivity and reducing costs. Strong inventory management has limited markdown risk while maintaining healthy in-stock levels. These efficiencies are allowing Walmart to pursue its long-standing goal of growing profits faster than sales.

WMT’s Estimate Revisions

Earnings estimates for Walmart have seen modest upward revisions in recent weeks. The Zacks Consensus Estimate for the current fiscal quarter and fiscal year has increased over the past 60 days, indicating stable analyst sentiment despite a somewhat uneven operating backdrop.

Risks to Monitor for Walmart in the Near Term

Despite its strengths, Walmart faces certain near-term challenges. Inflationary pressures, though moderating, continue to impact consumer purchasing behavior. While Walmart benefits from trade-down activity, sustained pressure on discretionary categories could weigh on mix.

Margin pressures also remain a concern. Investments in technology, automation and wage increases, though strategic, can create near-term cost headwinds. International markets also present currency and macroeconomic risks, particularly in emerging regions.

Final Take: Is WMT Stock Still a Buy?

Walmart’s steady sales growth, ongoing market-share gains and expanding higher-margin businesses reinforce its long-term strength. Surpassing the $1 trillion market cap milestone underscores investor confidence in its evolution into a tech-enabled omnichannel retailer. While near-term pressures around mix and costs remain, Walmart’s scale, discipline and diversified profit streams support sustainable earnings growth. Though the stock trades at a premium, the valuation reflects its quality and transformation. For investors seeking resilience with structural growth, Walmart remains an attractive long-term consideration, even at current levels.

WMT currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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