Goldman Sachs: Walmart (WMT) — Market Cap $914.2bn
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Key Views
Consumer trends remain broadly stable versus Q1: lower-income cohorts stay volatile but with narrowing fluctuations, middle-income is stable, and higher-income remains resilient. Management anticipates that price investments will support pressured lower-income shoppers.
Q2 faces sequential headwinds, including the non-recurrence of tax refund tailwinds, diminished benefits from general merchandise tariff-driven price increases, and a softening consumption environment. However, volume growth and market share gains may partially offset these pressures.
Walmart has referenced approximately $3 billion in tariff refunds being redirected toward price investment, though the receipt process is non-linear and the actual amount arriving by quarter-end remains uncertain.
Outlook
Goldman Sachs projects revenue growing from $713.163 billion in FY1/26 to $821.319 billion in FY1/29, with EBITDA expanding from $45.185 billion to $59.424 billion. Free cash flow is expected to dip to $3.186 billion in FY1/27E before recovering to $19.271 billion and $22.414 billion in FY1/28E and FY1/29E, respectively.
Recommended Securities
- Walmart (WMT): Buy; 12-month target price $154.00 (34.0% upside). Core thesis centers on value and convenience advantages driving market share growth and sustained profitability improvement.
Key exhibits
Exhibit 1
Exhibit 2
Exhibit 3
