| By Andy Swan Walmart (WMT) is undergoing a full-fledged brand renaissance.
More shoppers than ever are looking for value at their local Walmart, including the coveted high-income cohort. Better yet, those customers are increasingly happy with what they're finding. Walmart's consumer sentiment levels now trail the once-esteemed Target (TGT) by only three points.
The results speak for themselves: Yesterday, Walmart reported $169.3 billion in quarterly sales, growing nearly 5% from the same time last year.
Shares are up too, gaining 37% year-to-date to new all-time highs. 
Source: TradingView This company is proving it understands how to attract high-income trade-down shoppers. And based on consumer activity, it looks like the train will keep rolling in Walmart's favor... What's Next? Walmart is buckling down on what it does best: groceries, e-commerce, and deals. ✓ Groceries
Walmart is the number-one retailer in the U.S. by sales (raking in more than half a trillion dollars in 2023) and the nation's top grocer. Groceries are a major driver of purchases for the company, accounting for 60% of WMT sales in the last fiscal year.
The discrepancy between the price of cooking at home and buying food at fast-food chains or restaurants is helping to boost this demand. 
✓ E-commerce
Walmart's global e-commerce sales surged as much as 21% year over year in the most recent quarter (and +22% in the U.S.).
LikeFolio data shows app usage popping in July as the company successfully captured tailwinds from Amazon.com's (AMZN) summer shopping holiday: Prime Day.
Walmart app users increased by 13% year over year, while Sam's Club app users ticked 10% higher: 
Website data mirrors this strength. Sam's Club web visits are up by 4% year over year (besting Amazon), while Walmart visits ticked two points higher: 
Consumers of all income levels are hunting for value – and they're finding it at Walmart. ✓ Deals
Walmart typically outperforms in an inflationary environment, not just because it sells essentials (like groceries) but because consumers feel like their tickets come out lower compared to other retailers.
Revenue growth in the last quarter was powered by more transactions (+3.6%) and trips/visits/orders – not average ticket size, which was relatively flat (+0.6%).
And the company is continuing to slash prices, announcing deals on 7,200 more products.
Bottom line: We expect e-commerce growth and the continued trade-down effect from high-income shoppers to keep WMT buoyed.
Don't forget – it's also angling for advertising dollars with its planned acquisition of smart TV specialist Vizio (VZIO). Assuming the deal goes through, Walmart will soon be a game-changer in the streaming wars as well. That's what we'll be watching next.
Until next time, | 
No comments:
Post a Comment