Walmart Stock: WMT Is Playing Catch-Up With Drones

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Walmart Stores Inc. (WMT) isn’t exactly known for being on the cutting edge of technology. After all, it is Amazon.com (AMZN) and the rise of e-commerce that has put such a hurt to WMT stock over the last several years.

Walmart Stock: WMT Is Playing Catch-Up With DronesConsider that Walmart stock is actually sitting on a small loss since the beginning of 2012, while AMZN stock is up more than 200%.

But as the old saying goes, if you can’t beat them, join them.

And Walmart is pushing to follow in Amazon’s footsteps in many ways lately, including offering same-day shipping for the last few years on web purchases and, more recently, imitating Amazon Prime Day this summer with its own sales event.

The latest move? Filing with regulators to imitate Amazon on potential Drone delivery of items, according to a new report.

Walmart Stock Hops on the High-Tech Bandwagon

According to Federal Aviation Administration filings, Walmart is looking to join the ranks of cutting-edge tech stocks like Amazon and startups like Flirtey in using drones for delivery services.

This, from USA Today:

“Walmart has become the latest U.S. retailer to ask for permission to test drones for making deliveries to customers in its parking lots and at customers’ homes, following the lead of Amazon and smaller companies seeking exemptions from government drone rules.

Walmart also wants to use the aerial technology to check on its buildings, warehouses and distribution centers …

Walmart has tested drones inside its facilities but now wants to do outdoor tests. To do that, it needs FAA permission to operate “small unmanned aircraft systems,” as the industry calls drones.”

Now, it’s pretty amusing to me that Walmart is flying a bunch of shiny new toys around its warehouses like it’s Christmas. But it’s also undeniable that automation is the way of the future and that retail is already moving this way.

To once again return to front-runner AMZN, robots picking stock from Amazon warehouses help the company keep costs down and reduce the number of shipping errors.

Why wouldn’t Walmart want in on that?

Now, the million dollar question is whether WMT can innovate fast enough to keep up with existing rivals like Amazon while thwarting any scrappy e-commerce and drone-delivery startups that may come along.

I’m skeptical of that, but the reality is that Walmart really doesn’t have a choice. It’s either race to keep up, or risk falling further behind.

Jeff Reeves is the editor of InvestorPlace.com and the author of The Frugal Investor’s Guide to Finding Great Stocks. As of this writing, he did not hold a position in any of the aforementioned securities. Write him at editor@investorplace.com or follow him on Twitter via @JeffReevesIP

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