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  • Writer's pictureHelen Sanders

Walmart Achieves Record-High Stock Prices

On Friday, Walmart's shares hit a historic peak, as investors expressed their optimism in the retailer's ability to outshine its competitors and draw in customers during the holiday season, thanks to its well-established reputation for providing value.

The stock of the retail giant reached a pinnacle of $166.30 during the day, marking the highest point since Walmart's debut on the New York Stock Exchange back in August 1972.

Walmart, renowned for its extensive stores and affordable pricing, has demonstrated robust performance over the past year, even as U.S. consumers have exhibited restraint in discretionary spending on items like clothing and electronics.

As the largest grocer in the nation, Walmart generates more than half of its annual revenue from groceries, an essential category that continues to attract shoppers, even in the face of inflation or economic downturns. This strength in its grocery business has enabled Walmart to maintain foot traffic, while other retailers such as Macy's and Target have reported more cautious outlooks and weaker results.

Steady inflation, particularly in areas like food and household essentials, has presented an opportunity for Walmart to draw in new or less frequent shoppers to both its physical stores and website. In recent quarters, Chief Financial Officer John David Rainey noted that the company has successfully attracted more grocery shoppers from households with incomes exceeding $100,000.

As these customers visit Walmart's stores and website, they encounter the retailer's efforts to enhance the customer experience and stay competitive with more polished, tech-savvy rivals like Target and Amazon. Walmart has introduced and expanded its fashion-forward clothing brands, revamped its website and app, committed over $9 billion to modernize its stores nationwide, and broadened its online selection with higher-end brands through its third-party marketplace.

Walmart has also bucked a prevailing trend in the retail sector. While many companies have seen declines in online sales as the impact of the COVID-19 pandemic diminishes, Walmart has reported double-digit e-commerce growth for its U.S. operations in the past two quarters.

In an interview with CNBC in August, Rainey emphasized that while Walmart attracts customers with its competitive prices, it aims to surpass its competitors and retain these shoppers by prioritizing convenience, making it quick and easy for customers to complete their purchases. Curbside pickup and delivery have been driving forces behind the company's e-commerce growth.

Walmart's performance has not gone unnoticed by investors. Year-to-date, the company's shares have climbed by over 16%, outperforming the more than 13% gains of the S&P 500 and the roughly 3% gains of the retail-focused ETF, the XRT, during the same period.

Walmart is set to report its fiscal third-quarter results on November 16.

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