Deutsche Bank upgraded WMT to buy and lifted its target to $136 from $113, ~17% above yesterday's close: persistent, higher-than-expected inflation pushes shoppers to WMT for value and market share, and the speaker sees continued inflation benefiting it, though the stock lagged last year.

Let's look at Walmart as an example. Retail sales data has been released . Walmart stock is up 3.5%, sorry, 3.6% to be precise. Yes, let's add this stock to the purchase list.

Investors are adding to it thanks to a more optimistic outlook from the analyst community on the sell side. Deutsche Bank upgraded Walmart's rating from "hold" to " buy". They have raised their price target to $136.

That's an increase from $113. This represents an increase of approximately 17% from yesterday's closing levels .

The theory here is that the persistent inflation we have been talking about, and for which we have seen higher-than- expected figures, whether we are talking about the wholesale level, today’s producer price index or yesterday’s consumer price index.

The view is that this may drive shoppers to Walmart in search of deals, and in search of opportunities to stretch their budget further. They at Deutsche Bank believe that this will help the retail company gain a larger market share .

As we know, these high prices, especially at gas stations, put a strain on household budgets. Therefore, Deutsche Bank believes this helps lower-priced offers to become more attractive.

They believe that the whole issue revolves around the value proposition there.

This is one of the stories we are monitoring at Walmart. We can recall that very high inflation we saw in 2022, when we started to see shoppers with six-figure incomes moving to Walmart.

They have succeeded in retaining these customers.

But stocks did not perform well last year. Yes, there are gains, but the point here is that there is an opportunity for Walmart to take advantage of continued inflation and families looking for ways to stretch their budgets, which will benefit Walmart, Nicole.