Walmart Shares Zoom to All-Time High

 

By Alan Farley, Investopedia

Mar 19, 2020

 

Dow component Walmart Inc. (WMT) rallied to an all-time high above $128 on Wednesday, underpinned by shelter-at-home directives that are likely to trigger a wave of retail sector bankruptcies. The loss of brick-and-mortar rivals should put the big box giant in the driver's seat, increasing market share at the same time that wealth destruction forces many families to seek out cheaper shopping alternatives.

 

The rush to stock up on consumer staples has underpinned Walmart's uptick as well, with lines forming around its stores, as well as Target Corporation (TGT) and Costco Wholesale Corporation (COST). However, this positive catalyst should be temporary, with affected supermarkets and retailers working furiously to broaden supply chains. Even so, no one can rule out shortages that may generate panic buying events during the crisis.

 

Long-time market players watched the same playbook unfold in September 2008, just a few weeks before the October crash. Walmart shares zoomed to a six-year high at that time as investors watched the power of wealth destruction and realized that their shopping habits were undergoing a paradigm shift. However, illiquidity took control over buying interest just one month later, dumping the stock more than 25%. If past is prologue, new shareholders may wish to keep one finger on the exit button at all times...

 

WMT Short-Term Outlook ...

 

The Bottom Line ...

 

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https://www.investopedia.com/walmart-shares-zoom-to-all-time-high-4800232