10 Stocks Everyone is Talking About After Trump’s New Tariffs

4. Walmart Inc (NYSE:WMT)

Number of Hedge Fund Investors: 88

Simeon Gutman, Morgan Stanley retail analyst, said in a latest program on CNBC that he believes Walmart Inc (NYSE:WMT) e-commerce business is close to “turning the corner” and the company will start gaining new profit from its investments in the space.

“The stock has been appreciating, the multiple’s been going up for the last year or so, so the market sensed that this moment was happening. But for all of us who follow Walmart over its lifetime, especially the last decade, this is a watershed moment. Granted, there’s a lot of definitions of e-commerce profitability. I think people understand how costs are getting allocated. Walmart’s relatively conservative in how they look at it, and they don’t disclose this—this is our math, this is our estimate. But it looks like they’re turning the corner.

The most important point of that is leveraging these fixed investments, and in the next three years, it converts into $6 billion of incremental profits. On a base of, call it, $30 billion, that’s pretty significant—that’s 20% just from e-commerce crossing that threshold. The point at which they’ve put enough investment in the ground and the incremental sales are finally converting to new profit—that’s a big moment, and that’s confidence-building for the durability of their outlook.”