Where Will Walmart Stock Be in 3 Years?

Walmart is projected to outperform expectations in the next three years due to growth initiatives in online advertising, international expansion, and e-commerce. The company's online advertising business grew 27% year-over-year to $4.4 billion, and international revenue is targeted to double to $200 billion by 2028. Analysts estimate Walmart's revenue could reach nearly $800 billion by 2028, with per-share earnings swelling to $3.60, potentially driving the stock price to $144, a 47% gain.

Analysis

Walmart (NYSE: WMT) is strategically pivoting beyond its established U.S. brick-and-mortar dominance, evidenced by 11 domestic store closures last year, towards significant growth driven by initiatives in online advertising, international expansion, and e-commerce, while external risks like trade tariffs are viewed by the article's author as manageable. Its online advertising business generated $4.4 billion in high-margin revenue, up 27% year-over-year with Q1 growth accelerating to 31% YoY, and is poised to capitalize on a U.S. retail media market projected for 17.2% annualized growth. Internationally, Walmart targets doubling revenue to $200 billion by 2028 from a 2023 base of around $100 billion, having already achieved $121.9 billion last year. In e-commerce, Walmart's global online sales reportedly surged from approximately $25 billion in 2019 to around $100 billion last year, and its U.S. market share has more than doubled to 10.6% since 2017. Analysts project Walmart's revenue approaching $800 billion by 2028, with per-share earnings potentially rising from $2.41 (last year) to around $3.60. This earnings growth could support a stock price of approximately $144 within three years, a 47% increase from current levels implied by its trailing P/E of roughly 42x, with the article suggesting these forecasts might be conservative given Walmart's recent historical sales growth exceeding 6% annually since 2021.

Key Decisions for Investors

• Investors should evaluate Walmart's multi-faceted growth strategy, focusing on the high-margin online advertising segment which saw revenues of $4.4 billion (up 27% YoY), the ambitious international expansion targeting $200 billion in revenue by 2028, and its expanding e-commerce presence that reached approximately $100 billion in global sales last year.
• Key metrics to monitor include the growth rates of the advertising and international segments, progress towards the $200 billion international revenue goal by 2028, and the sustainability of e-commerce market share gains against competitors like Amazon.
• Consideration should be given to whether the current valuation, with a trailing P/E multiple around 42x, adequately reflects these growth prospects and the potential for a 47% stock appreciation to approximately $144, especially if the company continues to exceed historical growth rates as these new ventures mature.