Wal-Mart Stores Inc (NYSE:WMT) — This, the largest retailer in the world with over 10,000 discount department stores, wholesale clubs, supermarkets and supercenters, has successfully fought to maintain its position in a highly competitive environment.
Last Thursday, CFRA (S&P Global) issued a stock report in which it kept a “Five-Star Strong Buy” rating on the stock while increasing the 12-month target to $87 from $81 and their fiscal year 2018 (Jan.) earnings per share to $4.36, up from $4.30. The increase was the result of WMT’s April quarterly result of $1, which beat S&P’s estimate by 5 cents. They pointed out that comparable store sales growth of 1.4% was driven mainly by food sales and “U.S. e-commerce sales growth of 63% was driven by a 5X increase in assortment and faster delivery offering.”
In October 2015, the board approved a $20 billion share buyback plan. As of May ’17 $7 billion remained to be completed. WMT pays an annual dividend of $2.04 for a dividend yield of 2.6%.
Early in April, WMT stock broke a 10-month resistance line at $73, advancing to about $77 before retreating to about $75 last Wednesday. Several major research firms increased both earnings and price targets, and on Thursday the stock broke to a new high, which was followed by another advance on Friday.
WMT stock is, however, still shy of its all-time high of $91 made in January ’15 but appears destined to test that high. Thus traders should try to buy this blue-chip member of the Dow Jones Industrial Average at $78 for a target of $88 and a proposed return of almost 13%.
EDITOR’S NOTE: Our Chief Technical Analyst Sam Collins is retiring on June 1. Your Daily Trader’s Alert emails will continue uninterrupted, but will feature new analysts going forward. To learn more about the changes click here, and to join our “online going-away party” and wish Sam farewell click here.
Tell us what you think about this article! Drop us an email at editor@investorplace.com, chat with us on Twitter at @InvestorPlace or comment on the post on Facebook. Read more about our comments policy here.
