UBS Upgrades Wal-Mart (WMT) to Buy; Entering Era of Amplified Earnings Growth

June 22, 2020 5:23 AM EDT
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Price: $142.25 --0%

Rating Summary:
    33 Buy, 15 Hold, 4 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 5 | Down: 7 | New: 7
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(Updated - June 22, 2020 6:04 AM EDT) (updating comment)

UBS analyst Michael Lasser upgraded Wal-Mart (NYSE: WMT) from Neutral to Buy with a price target of $135.00 (from $130.00), saying the company is entering an era of amplified earnings growth.

The analyst comments "Our thesis is that WMT is entering an era of amplified earnings growth driven by an enhanced productivity loop, increased eCommerce scale, and accelerated technology deployment. These factors alone should enable it to achieve EPS of $6+ in FY'23E (vs. the consensus of $5.80). At the same time, WMT has several sources of additional upside such as fruition in healthcare, traction in advertising, and success in key markets like India. Its business model can benefit from trip consolidation. Besides, WMT offers the prospect of best-in-class consistency in an uncertain environment. We believe these elements will enable WMT's shares to maintain a premium multiple, especially as the gap between the leaders & laggards in retail widens. WMT's premium to the avg. multiple at TGT & KR has narrowed to 38% (3 yr avg of 52%). Its premium to the S&P has narrowed to 12% (3 yr avg of 16%)"

For an analyst ratings summary and ratings history on Wal-Mart click here. For more ratings news on Wal-Mart click here.

Shares of Wal-Mart closed at $120.85 yesterday.


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