US retailer Walmart (WMT:NASDAQ) burst through the $1trn market cap barrier on 3 February. In crossing this threshold, the groceries-to-general merchandise seller joined an elite club dominated by tech giants including Alphabet (GOOG:NASDAQ), Microsoft (MSFT:NASDAQ) and Nvidia (NVDA:NASDAQ).
| Share price: $127.7 (+3%) | PE: 44.8 |
| Market cap: $1.02trn | Yield: 0.74% |
How did Arkansas-based Walmart became the first-ever retailer to reach a $1trn valuation?
By taking market share in groceries and general merchandise, then spreading its tentacles into areas such as ecommerce and advertising.
Walmart’s a winner
Walmart’s elevation to the $1trn club was fuelled by the year-in, year-out acquisition of new customers. It won over millions of higher-income shoppers during the post-Covid period of elevated inflation of recent years.
In addition, it launched Walmart+ to rival Amazon Prime, built an enormous advertising business and was an early AI adopter, funnelling billions into supply chain automation to improve stock forecasting and speed up deliveries.
Surging online sales helped it compete with Amazon (AMZN:NASDAQ) and the company recently underscored its ambitions in technology by switching its listing from the New York Stock Exchange to Nasdaq.
Hats off to Doug
Most of the credit for Walmart’s meteoric rise goes to Doug McMillon, the retailer’s long-serving former boss. McMillon was recently succeeded as CEO by John Furner, head of Walmart’s core US business.
Furner has presided over many initiatives which have driven the company’s growth more recently. These include curbside pickup and the launch of private-label brands which helped the discounter attract higher-income shoppers at a time of soaring inflation.
Walmart’s shares closed almost 3% higher at $127.7 on 3 February, leaving the company with a $1.02 trillion market cap. They have risen more than 25% in the past year and 165% over the last five years, beating the S&P 500 over both timeframes.
Other members of the $1trn club include Apple (AAPL:NASDAQ), Amazon, Meta Platforms (META:NASDAQ), Tesla (TSLA:NASDAQ), Broadcom (AVGO:NASDAQ) and Warren Buffett’s Berkshire Hathaway (BRK.B:NYSE).
You might also like:
