In 2025, Wendy’s stock plummeted by almost half as revenue and net income declined due to high fast food prices turning off consumers, who opted for grocery shopping. Meanwhile, Walmart, relying heavily on grocery sales, has growth opportunities to boost margins and aims to reach a $1 trillion valuation in 2026.

Walmart’s wide product range and brick-and-mortar presence give it an edge over competitors, especially in e-commerce. The retailer’s ability to facilitate same-day deliveries and bulk purchasing lowers costs, allowing for competitive prices and increased customer loyalty compared to Wendy’s convenience-focused model.

Walmart’s diverse revenue sources and efficient operations lead to lower grocery prices and larger average order sizes, ensuring profitability. In contrast, Wendy’s struggles to increase profit margins as consumers push back against rising fast food prices. Walmart’s focus on groceries meets a critical need for many Americans, driving its success.

While Walmart’s retail business remains a core focus, increasing digital advertising efforts aim to raise profit margins in the long run, similar to Amazon’s strategy. Walmart’s online ad revenue surged by 53% year over year, potentially boosting margins that currently hover around 3%. Wendy’s faces challenges in expanding margins and reported declining revenue and net income in Q3.

Walmart offers better growth opportunities and affordable groceries compared to Wendy’s convenience-focused model, attracting consumers seeking cost-effective options. Investors should consider alternative stock options as Walmart aims to increase profitability and expand its market reach beyond groceries.

Read more at Yahoo Finance: Forget WEN Stock and Look at WMT Instead