NEW YORK (TheStreet) -- Shares of Walmart Stores Inc (WMT) are slipping, lower by 0.94% to $84.14 in early market trading Thursday, after the retail giant was downgraded to "neutral" from "buy" by analysts at UBS this morning.
Analysts at the firm maintained its price target of $91.
UBS analysts cited a balanced risk/reward for its cut in rating.
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Walmart recently announced the expansion of its "Grab & Go" locker service in Canada, replacing a trip to the human-operated service desk at stores to pick up a product ordered online.
Bentonville, AR-based Walmart operates retail and other stores in various formats including membership clubs, operating under Walmart U.S., Walmart International and Sam's Club.
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, good cash flow from operations, increase in stock price during the past year, growth in earnings per share and reasonable valuation levels. We feel these strengths outweigh the fact that the company has had sub par growth in net income."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- WMT's revenue growth has slightly outpaced the industry average of 0.9%. Since the same quarter one year prior, revenues slightly increased by 2.9%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- Net operating cash flow has significantly increased by 72.54% to $3,570.00 million when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of 49.58%.
- The stock price has risen over the past year, but, despite its earnings growth and some other positive factors, it has underperformed the S&P 500 so far. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
- WAL-MART STORES INC reported flat earnings per share in the most recent quarter. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in 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 ($5.00 versus $4.86).
- You can view the full analysis from the report here: WMT Ratings Report