JFrog stock rises as Cantor Fitzgerald maintains Overweight rating after strong Q2
Baird has reaffirmed a positive outlook on Walmart Inc. (NYSE: NYSE:WMT), increasing the retail giant's price target to $82 from the previous $70 while retaining an Outperform rating. The firm highlighted Walmart's successful second quarter, noting significant contributions from digital sales and high-margin income streams.
Walmart's business model and profit and loss transformations were evident in the second quarter, with approximately 70% of the company's comparable U.S. growth being driven by digital channels. Additionally, more than half of the enterprise-wide earnings before interest and taxes (EBIT) growth stemmed from higher-margin advertising and membership revenues.
The consistency in shopping behavior was also a key point, with growth primarily fueled by an increase in transactions rather than inflation. This trend suggests Walmart is making share gains in the current fluctuating economic environment. Although the company's guidance remains cautious and falls short of consensus expectations, Baird senses a potential upward trend.
Also, Walmart recently received an upgraded price target from RBC Capital and robust growth in the second quarter of fiscal year 2025. RBC Capital raised Walmart's price target to $80.00 from the previous $74.00, maintaining an Outperform rating. This adjustment stems from Walmart's notable top-line growth, robust operating income growth, and RBC Capital's positive view on the company's future earnings potential.
Furthermore, Walmart's second-quarter performance for fiscal year 2025 showcased strong sales and profit growth. Key drivers of this growth included a solid performance across its international and e-commerce segments, and the company subsequently raised its full-year guidance for sales and operating income growth. Analysts from RBC Capital revised their forecasts for Walmart's U.S. comparable sales growth and consolidated constant currency net sales growth for fiscal years 2025 and 2026.
RBC Capital also increased its adjusted EPS estimates for Walmart to $2.44 for FY'25 and $2.75 for FY'26, up from the previous estimates, reflecting their confidence in Walmart's earnings potential. These recent developments underline the positive outlook for Walmart's performance and its potential for continued growth.
InvestingPro Insights
Walmart's (NYSE:WMT) recent performance has not only caught the attention of Baird but also aligns with several key metrics and insights from InvestingPro. For instance, the retail behemoth has demonstrated a strong track record of dividend reliability, having raised its dividend for 29 consecutive years and maintained payments for 52 consecutive years, an indicator of the company's commitment to shareholder returns. This is particularly relevant for investors looking for stable income in their portfolio. Moreover, Walmart's significant return over the last week, with a 7.7% price total return, underscores the positive momentum highlighted by Baird.
In terms of valuation, Walmart's current P/E ratio stands at 35.78, with an adjusted P/E ratio for the last twelve months as of Q2 2025 at 32.86. While the company is trading at a high P/E and price/book multiple, the PEG ratio of 0.46 suggests growth potential that may not be fully reflected in the P/E ratio alone. This could be an indication that Walmart's earnings growth prospects are strong relative to its current share price. Additionally, with a market cap of $588.63B and a solid revenue growth of 5.43% over the last twelve months as of Q2 2025, the company's size and growth trajectory remain robust.
For those interested in further analysis, there are over 15 additional InvestingPro Tips available, providing a deeper dive into Walmart's financial health and market position. These tips can be accessed for more informed investment decisions on the InvestingPro platform at https://www.investing.com/pro/WMT.
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