From Yahoo Finance: 2025-04-12 08:11:00

Walmart Inc. (WMT) is a popular defensive stock, historically performing well in uncertain markets with its stable dividend and low beta. Investors are attracted to its defensive qualities and steady growth, despite the challenges posed by tariffs, especially those targeting China.

The looming threat of Trump’s tariffs on China has created uncertainty in the stock market, affecting global retailers like Walmart with complex supply chains. With a significant portion of its supplier network outside the U.S., particularly in China, Walmart faces higher import costs and may need to raise prices, potentially impacting demand and sales.

Despite the challenges posed by tariffs, Walmart has been making strides in expanding its market share and attracting customers across income levels, especially through investments in e-commerce. While tariffs may lead to a broader economic value squeeze, Walmart’s value leadership position could provide stability during tough times, making it a defensive play for investors.

However, with a high forward earnings multiple and modest growth outlook, Walmart’s current valuation may not offer a significant margin of safety for investors. While the stock is seen as a defensive option, its premium price reflects its quality and resilience in turbulent market conditions.

Analysts maintain a Strong Buy consensus rating on Walmart stock, with an average price target implying upside potential. While Walmart remains a solid defensive choice for investors, the current valuation suggests a neutral stance may be prudent. The stock’s strong fundamentals and growth potential make it a stable option, but the price may not offer a clear margin of safety in the current market environment.

Read more: Why Walmart’s (WMT) Defensive Appeal Comes at a Steep Price