Stock Showdown: Wal-Mart Stores, Inc. (WMT) Vs. Target Corporation (TGT) – Which Is The Better Retail Stock?

Insider activity at Wal-Mart has been limited this year, with only one recorded sale, of 2,400 shares by the Senior Vice President of Wal Mart Stores Inc, Steven Whaley. Insider trading at Target Corporation has been more active as the shares have gained ground, with 13 sales in 2015, alongside no insider purchases. Two of the major sales involved Kathryn Tesija, the Executive Officer at Target Corp, and Timothy Baer, another Executive Officer, who sold 269,091 shares and 148,055 shares respectively in 2015.

In addition to insider buying and selling, we will also take a look at the hedge fund activity in the shares of these two companies. Wal-Mart Stores is owned by 63 hedge funds as of March 31, compared to 51 which reported ownership positions during the previous quarter. However, the value of the overall holdings increased only slightly, to $9.21 billion from $9.16 billion. Within our database, Warren Buffett’s Berkshire Hathaway is indisputably the largest shareholder of Wal-Mart Stores, owning 60.38 million shares, which represent 4.63% of its entire public equity portfolio. Michael Larson’s Bill & Melinda Gates Foundation Trust is the second-largest shareholder of Wal-Mart within our database, owning 11.60 million shares as of March 31. Both major shareholders preferred to hold onto the stock of the company during the first quarter. In the meantime, the number of hedge funds that hold equity stakes in Target Corp as of March 31  increased to 43 from 37, while the total value of their investments increased to $1.33 billion from $939.06 million. One of the major investors in Target Corp among those we track was hedge fund manager Ken Griffin representing Citadel Investment Group, who held a stake of 4.37 million shares at the end of the first quarter. The fund increased its holding by 779% during the quarter.

To conclude, if Wal-Mart Stores manages to go through its under-performing store closing program and find a way to attract more local customers, the shares do indeed have upside, however in the meanwhile, Target Corporation seems like the better pick, with stronger present growth and more immediate potential for more.

Winner: Target

Disclosure: None