The firm raised the price target to $79 from $72 for the discount warehouse and department store retailer.
MKM reiterated its "neutral" rating and said the raise reflects recent multiple expansion across the market and retail.
"We expect some year-over-year margin improvement in 4Q14 as Walmart cycles a number of one- time or discrete expenses, including store closings in Brazil and China, but on a normalized basis, we look for margin pressures to continue," said MKM Managing Director Patrick McKeever.
Shares of Walmart Stores are down 0.41% to $82.60 in pre-market trading on Friday.
Separately, TheStreet Ratings team rates WAL-MART STORES INC as a Buy with a ratings score of A-. TheStreet Ratings Team has this to say about their recommendation:
"We rate WAL-MART STORES INC (WMT) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its revenue growth, increase in net income, reasonable valuation levels and notable return on equity. We feel these strengths outweigh the fact that the company shows low profit margins."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- WMT's revenue growth has slightly outpaced the industry average of 3.2%. Since the same quarter one year prior, revenues slightly increased by 2.8%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- The net income growth from the same quarter one year ago has exceeded that of the Food & Staples Retailing industry average, but is less than that of the S&P 500. The net income increased by 0.6% when compared to the same quarter one year prior, going from $4,069.00 million to $4,093.00 million.
- WAL-MART STORES INC' earnings per share from the most recent quarter came in slightly below the year earlier quarter. The company has suffered a declining pattern of earnings per share over the past year. However, we anticipate this trend reversing over the coming year. During the past fiscal year, WAL-MART STORES INC reported lower earnings of $4.86 versus $5.01 in the prior year. This year, the market expects an improvement in earnings ($5.01 versus $4.86).
- The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Food & Staples Retailing industry and the overall market, WAL-MART STORES INC's return on equity exceeds that of both the industry average and the S&P 500.
- You can view the full analysis from the report here: WMT Ratings Report