Truist upgrades Walmart to Buy on share gains, higher margins

Truist upgraded Walmart to Buy from Hold with a price target of $89, up from $76. Walmart continues to gain share across income levels, due to its focus on price, convenience and assortment, the analyst tells investors in a research note. The firm says its work suggests the company is increasingly using its “rapidly growing, higher-margin” revenue streams like advertising, membership and marketplace to expand price gaps, gain share and structurally push margins higher. The combination of accelerating share gains, the “scarcity value of an offensive and defensive mega-cap” and a structurally more profitable company “should command a far higher-than-historical valuation,” Truist contends.