Wal-Mart impresses with broad portfolio and strong growth

Consumer sentiment in the USA is experiencing a positive turnaround: In August, it climbed to its highest level in six months. This optimism about economic prospects could trigger improved consumer sentiment, as reported by the Conference Board at the end of August. This significantly reduces the likelihood of a recession. The Consumer Confidence Index rose from 101.9 to 103.3 in August. Nevertheless, uncertainty in the labor market persists, which also concerns the Federal Reserve. In a speech at the annual economic conference of the Kansas City Fed, Jerome Powell, Chairman of the Federal Reserve, emphasized the need for a stable labor market. However, he expressed optimism that the inflation rate would remain around the target mark of 2%. The rise in unemployment is mainly due to slow hiring rather than layoffs. Consumer prices in the USA rose only moderately in July, according to a report by the Department of Labor. Producer prices also showed a slight increase in August, indicating a downward trend in inflation. Consumers continue to hunt for bargains and avoid high prices, which particularly benefits discount retailers. Our Methodology: Using the Finviz Stock Screener, we identified stocks of department store and discount retailers. These were ranked in ascending order based on the number of hedge fund shareholders. Our analysis shows that mimicking the top stock picks of the best hedge funds allows for outperforming the market. Walmart is the world's largest retailer, operating approximately 10,600 stores in 23 countries. Compared to competitors like Target with 2,000 stores and Kroger with 2,750 stores, Walmart is clearly dominant. Walmart relies on an omnichannel system, which significantly contributes to impressive growth in the e-commerce sector. The Walmart+ program recorded a 14.4% increase in membership, contributing to revenue growth. Targeting high-income households and introducing high-quality brands such as Chaps and Reebok also brought success. Due to its strong position in the food sector, Walmart remains resilient to economic fluctuations. Approximately 50% of revenues come from the food sector, which is independent of the economic cycle. Additionally, 25% of sales come from general merchandise. With 95 hedge funds investing a total of $9.19 billion and a buy recommendation from analysts, Walmart remains an attractive investment option. Although WMT tops our list of the best retail stocks, we see greater potential for higher returns in a shorter time with AI stocks.