Walmart Stock Downgraded Amid E-commerce Challenges

Walmart's stock has been downgraded by Oppenheimer from 'Outperform' to 'Perform', citing concerns over pharmacy sales pressure and high valuation. The company is set to report its fiscal Q2 2027 results on August 20, with previous guidance of $0.72-$0.74 adjusted earnings per share and 4%-5% net sales growth.

The downgrade comes despite Walmart's recent earnings slightly beating estimates, but challenges remain in growing profitable merchandise sales beyond groceries. The company dominates U.S. grocery spending with a 20.8% share, far ahead of Amazon's 2.9%, securing frequent shopper visits.

However, Amazon leads in broader retail categories like electronics, apparel, and home goods, capturing 9.3% of total U.S. retail sales. The downgrade also follows Walmart's recent pullback from a May high of $131.45 to around $112.53 in July, but the company is expected to rebound.