Walmart shares fell 7.3% after a cautious Q2 outlook, but analysts see 15% upside amid high inflation and strong eCommerce growth.
Walmart (WMT) shares plunged 7.3% on May 21, 2026, closing at $121.34 after a subdued second-quarter outlook overshadowed solid first-quarter results. The decline pushed the stock more than 10% below its 52-week high, reflecting investor concerns over near-term performance.
Morgan Stanley analysts reiterated their Overweight rating on WMT and kept a $140 price target, suggesting 15% upside. The firm highlighted Walmart’s resilience in a 3.8% inflation environment, driven by its eCommerce flywheel—online sales, advertising, and membership income all surged in Q1. Operating profit for Walmart U.S. hit a record $1.1 billion, with margins supported by higher-margin segments offsetting fulfillment costs.
U.S. inflation climbed to 3.8% in April, the highest since May 2023, with energy and food costs leading the increase. Analysts argue this backdrop plays to Walmart’s strengths, reinforcing its competitive position in retail.