Walmart Stock Delivers Returns By Riding Change. This Investor Explains How.

Walmart stock could profit from leading a change in traditional retail businesses. But to do so, this trader says the retailer must keep its focus on technology, and sometimes on the diversified revenues that result.

Walmart (WMT) stock hit a new all-time high of 134.65 during Friday’s trading, putting the stock in a profit zone for investors that got in at a 109.58 buy point after the stock formed a 29-day flat base chart pattern. The profit zone represents a 20% gain in the stock from the buy point. The stock broke out of the pattern on Nov. 26.

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Nancy Tengler, CEO and Chief Investment Officer of Laffer Tengler Investments, says the retailer became successful by being unafraid to focus on new technologies like robotics, e-commerce infrastructure, digital business and even advertising.

“We own one consumer staple, and that’s Walmart,” Tengler told Investor’s business Daily’s “Investing with IBD” podcast. “It has been our poster child for ‘old economy’ companies pivoting to the new technologies.”

Audio Version Of Podcast

Tengler says what sets Walmart apart from peers is its approach to finding and using new technology, even to further its core business. “There’s a company we own in our thematic portfolio called Symbotic, an automation robotics company,” she said. “Their first client was Target (TGT), but Target did not implement the software.”

“You know who did? Walmart.” Tengler says the company can now make faster, fully automated deliveries, giving it a way to compete with other digital native retailers like Amazon.

Walmart stock began to pull ahead of its rival Target during April of last year, and retains a commanding lead. Walmart shares have grown 27.35% over the past year while Target has fallen 10.2%, according to MarketSurge.

Walmart is set to report earnings on Thursday, Feb. 19, which may introduce some volatility in the stock. And its pursuit of new technologies can incur heavy capital expenditures, particularly for unsuccessful tech bets the retailer makes.

But Tengler says that while Walmart’s valuation may be “pretty rich now, that can stay rich for a long time.”

“I think they will continue to deliver,” she said.

_Follow Mike Juang on X at _@mikejuangnews and on Threads at @namedvillage.

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