Barclays also raised its price target to $87 from $70 on shares of the Bentonville, AR-based big-box retailer.
The firm initiated the food and staples retailing industry in the note with a "neutral" view, and said that Walmart is its top pick in the sector.
"The third quarter is set to be the most challenging for food retailers in well over a decade as they grapple with deflation on top of deflation year over year - a phenomenon not experienced since 1960," the firm noted.
But Barclays added that "this headwind coincides with Walmart's re-emergence as a disrupter."
Walmart has the ability to "wreak havoc" on competitors in the sector, the firm said.
Separately, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.
TheStreet Ratings rated this stock as a "buy" with a ratings score of B.
The company's strengths can be seen in multiple areas, such as its solid stock price performance, increase in net income, revenue growth, good cash flow from operations and largely solid financial position with reasonable debt levels by most measures. We feel its strengths outweigh the fact that the company shows low profit margins.
You can view the full analysis from the report here: WMT