It is a big day for retail giant Walmart (WMT), as it opened the doors on its new headquarters location in Bentonville, Arkansas. It also has a new proposal to advance its line of store brand products. This combination of events sat well with investors, and shares gained fractionally in Friday afternoon’s trading.
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The new headquarters location covers a whopping 350 acres of ground, and will be opening in stages. The campus contains a total of 12 office buildings, and of these, two are now officially open. The remaining 10 buildings will be opening up in stages for employee use. The campus also includes childcare facilities as well as a food hall, bicycle trails, and a fitness center, according to a report from Business Insider.
But the centerpiece of the new headquarters is Sam Walton Hall, named for Walmart founder Sam Walton. Centrally located, it includes a two story auditorium that, by itself, is a 200,000 square foot space. It will serve as a point for conferences and educational operations. Further, an outdoor amphitheater named for Helen Walton, Sam’s wife, is not too far away and will contain 750,000 native plants.
Ramping up the Store Brands
Walmart is already known for its store brands. Great Value, Equate, Mainstay and Freshness Guaranteed represent four of the biggest store brands around. But Walmart wants to augment its store brand selection, noted a report from the Wall Street Journal, thanks to a rapid growth seen in private label sales. While national brands grew 3.4% between 2020 and today, private label sales grew 4.7%.
This has several potential causes, including soaring inflation sending up the costs of goods to consumers, and those consumers in turn looking to save some money, somewhere, by buying off-brand merchandise in a bid to stretch their shopping dollars. This potential is hardly lost on Walmart, and it is not alone here, either. Target (TGT) is also looking to ramp up its store brand sales in a bid to keep pace.
Is Walmart Stock a Good Buy Right Now?
Turning to Wall Street, analysts have a Strong Buy consensus rating on WMT stock based on 26 Buys and two Holds assigned in the past three months, as indicated by the graphic below. After a 71.27% rally in its share price over the past year, the average WMT price target of $99.56 per share implies 8.29% upside potential.
