Analyst Explains Why Walmart (WMT) Remains ‘Top Idea’ Despite Tariff Impact

Oliver Chen, TD Cowen retail analyst, recently said in a program on CNBC that he likes Walmart despite the impact of tariffs.

“Walmart (NYSE:WMT) has been a top idea for us because it addresses both needs and wants. It has a great value-leading grocery business. In addition, there’s the technology—think about digital marketing, digital advertising, and the marketplace. Ever since Sam, Walmart has always had an everyday low price focus. The company is focused on value. That being said, as they balance all these stakeholders, they will have to raise some prices—but they’ll still have the lowest prices.”

Walmart investors got spooked after the company said it would have to raise prices due to the impact of tariffs when it recently reported its latest results. During the quarter, the company saw a 4% year-over-year inventory increase. outpacing 3% revenue growth—raising some investor concerns despite the CFO’s reassurances. However, WMT bulls believe the company is positioned well for the long term amid several revenue streams and dominance in the industry. Its e-commerce channel, now nearly 20% of total revenue, has turned profitable globally. Walmart Connect’s ad business jumped 31% in the US and 50% across markets, and Sam’s Club delivered solid comps with operating margins hitting 3%.

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Disclosure: None. This article is originally published at Insider Monkey.