By Senad Karaahmetovic
Goldman Sachs analysts reiterated a Buy rating on Walmart (NYSE:WMT) heading into the highly-anticipated investor meeting that is due on April 4 and 5.
The analysts remind investors that these meetings have a history of moving the WMT stock.
“We’ve seen sizable single-day stock moves on past WMT Investor Days (ranging from -3% to +10% for the past seven Investor Days), noting directional margin commentary and EPS guidance have typically been the main drivers,” they said in a client note.
Still, the analysts expect the focus of the management to be on “strategy updates for several key initiatives which should support the company’s long term algorithm for +4% top line and even better operating income growth.”
“Specifically, we are looking for details on ecommerce, Walmart Connect, Walmart+, grocery, home & apparel, health & wellness, the supply chain, and capital allocation (each discussed in further detail below),” they added.
Morgan Stanley analysts agree as they also see the upcoming event as a “positive catalyst” for the stock.
“We like WMT’s risk/reward skew at current levels. EPS visibility is solid; we estimate 45 bps of gross margin "conservatism" in WMT"s F'24 guide. The stock has lagged, but defensives could outperform from here and we believe the additional quantitative building blocks to margin expansion discussed at the Meeting should be positive. We also believe pressure from the Walton Family Trust's selling should abate,” they wrote in a client note.
Walmart shares are trading flat year-to-date (YTD).