How Walmart is Positioning for Comp Growth Amid Consumer Shifts?
A major driver of this traffic momentum is Walmart's expansion of store-fulfilled delivery, now reaching 93% of U.S. households with delivery in under three hours. In the fiscal first quarter, one-third of Walmart's deliveries were expedited, underscoring the increasing role of convenience in driving customer visits.
Membership remains another key growth lever. Walmart+ membership income rose at a double-digit rate. The company's health and wellness category surged with high-teens growth, supported by strong prescription volume and over-the-counter product sales. To reinforce its price leadership, Walmart implemented more than 5,000 price reductions during the quarter.
Walmart's strategy reflects a retail model that integrates stores, digital convenience and membership-driven engagement. By prioritizing faster fulfillment, competitive pricing and a broader customer reach, Walmart is positioning itself to drive steady same-store sales growth while adapting to evolving consumer demands in a highly competitive retail landscape.
Walmart's Comp Growth Compared With Target and Costco
Target Corporation TGT reported a 3.8% decline in comparable sales for the first quarter of fiscal 2025, driven by weaker discretionary demand. However, Target continues to prioritize same-day services, with Drive Up accounting for nearly half of digital sales in the quarter. Target expanded the Target Plus marketplace, growing GMV more than 20%, aiming to enhance assortment and offset comp pressures.
In contrast, Costco Wholesale Corporation COST reported 5.7% total company comparable sales growth in the third quarter of fiscal 2025, with U.S. comparable sales up 6.6%. Costco benefited from strong traffic and private label gains via Kirkland Signature. In addition, Costco is using local sourcing and strategic inventory management to maintain volume-driven comparable sales growth despite inflationary and tariff headwinds.
WMT's Price Performance, Valuation and Estimates
Shares of Walmart have gained around 0.4% in the past three months compared with the industry 's growth of 0.3%.
Image Source: Zacks Investment Research
From a valuation standpoint, WMT trades at a forward price-to-earnings ratio of 34.74X, significantly up from the industry's average of 31.99X.
The Zacks Consensus Estimate for WMT's fiscal 2026 earnings implies year-over-year growth of 3.6%, whereas the same for fiscal 2027 indicates a year-over-year uptick of 11.7%.
WMT currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
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