Summary
DA Davidson raised its price target on Walmart Inc. (WMT) to $150 from $135 and reiterated a Buy rating, citing the retailer’s ability to convert investments in automation, artificial intelligence and expanded service offerings into what the firm calls "margin currency." That margin benefit, the analyst says, is being plowed back into lower prices and greater convenience for customers, contributing to share gains across cohorts.
Details and analyst view
Michael Baker of DA Davidson described Walmart’s operating model as a flywheel. According to the analyst, past investments in automation, AI and agentic commerce, together with an expanding suite of alternative businesses, are producing incremental margin that management is using to support pricing and convenience initiatives. Baker’s view emphasizes the interplay of automation-led cost savings and reinvestment aimed at driving top-line and share gains.
DA Davidson singled out Walmart’s so-called triple A approach - automation, AI and alternative businesses - along with a parallel 3M focus on membership, media and marketplace. Within those alternative businesses, membership, media and marketplace are now contributing at least one-third of company profits, the analyst noted.
On a reported basis, Walmart’s latest revenue stood at $703 billion, reflecting growth of 4.3%. Baker argued this operating model is helping Walmart consistently outpace its stated algorithm of roughly 4% sales growth and an adjusted operating profit band of above 4% to 8%.
Analyst revisions and market context
DA Davidson’s action follows a series of analyst updates. TD Cowen raised its target to $145, citing Walmart’s leadership in AI within retail. Telsey lifted its target to $140, pointing to ecosystem expansion and strategic tech investments, including AI. KeyBanc kept an Overweight rating with a $145 target after noting a strong fourth-quarter showing and market-share momentum. Bernstein raised its target to $134, highlighting e-commerce strength and profitability gains driven in part by automation and growth in global advertising revenue.
Not every firm is uniformly bullish. HSBC moved Walmart to a Hold rating despite increasing its price objective to $131, pointing to valuation concerns and lowering earnings forecasts after Walmart’s guidance fell short of expectations. HSBC described the outlook as more conservative under the company’s new management team.
Analyst activity and earnings revisions
An InvestingPro note included with the coverage cited that 10 analysts have recently revised earnings estimates upward for Walmart. The market capitalization reported in the coverage is $979 billion and the company was trading at a price-to-earnings ratio of 42.9, with an InvestingPro assessment that the stock appears overvalued relative to its Fair Value.
Implications for investors
DA Davidson’s upgrade of the price target reflects a conviction that productivity gains from automation and AI, plus a growing contribution from alternative revenue streams, are material to margins and competitive positioning. At the same time, divergent analyst actions underscore that valuation and guidance remain meaningful considerations for investors assessing Walmart’s risk-reward profile.
Note: This report summarizes recent analyst actions and company metrics cited in coverage; it does not introduce additional facts beyond those provided by the analysts referenced.