Updated: December 23, 2025
Walmart Inc. (WMT) stock traded lower on Tuesday as investors balanced the retailer’s powerful 2025 run—driven by fast-growing digital and higher-margin businesses—against a fresh burst of legal and regulatory headlines tied to recalled infant formula and product-safety scrutiny.
At the same time, Wall Street’s broader debate about Walmart’s valuation has only intensified: bulls argue the company is evolving into a “retail-tech” compounder powered by e-commerce, advertising, membership, automation, and data; skeptics counter that the stock is priced for near-flawless execution in 2026 and beyond.
Walmart stock price today (WMT): shares dip in holiday-week trading
As of the latest trade on Tuesday, Dec. 23, Walmart shares were at $111.41, down $1.19 (-1.06%) from the prior close, with the session ranging roughly from $111.21 to $112.74.
The pullback follows a strong year for Walmart’s stock. A widely circulated Zacks/Nasdaq analysis published earlier this month pegged WMT up about 25% year-to-date in 2025, reflecting sustained investor confidence in Walmart’s omnichannel momentum. [1]
What’s driving Walmart stock on Dec. 23, 2025: the headline risk investors are watching
1) ByHeart infant-formula recall fallout expands to retailers
One of the most immediate storylines impacting sentiment is litigation tied to ByHeart infant formula and an outbreak of infant botulism.
- FDA warning letter and recall-compliance issues: Reuters reported that the FDA sent warning letters to Walmart and other major retailers after regulators said recalled ByHeart formula remained available for sale even after recall notifications. [2]
- FDA details: The FDA’s warning-letter posting describes an investigation linking ByHeart Whole Nutrition Infant Formula to a multistate infant-botulism outbreak and states that recalled product was found available for purchase at Walmart stores across multiple states after recall notices. [3]
- New legal development: On the legal front, Bloomberg Law reported that Target, Whole Foods, and Walmart are expected to be added as defendants in the ByHeart lawsuits for selling the product. [4]
While the market typically treats these kinds of cases as difficult to quantify early (especially before damages, insurance coverage, and procedural milestones become clearer), investors often discount near-term “headline risk” quickly—particularly when a stock is already priced at a premium.
2) Another lawsuit in the background: PepsiCo and Walmart price-fixing allegations
In a separate legal matter, Reuters reported a class action accusing PepsiCo and Walmart of an alleged price-fixing scheme related to Pepsi soft drinks. Both companies have pushed back on the claims in public statements cited by Reuters. [5]
3) “Priced like tech?”—valuation debate stays front and center
Walmart’s multiple expansion has become a core narrative of late 2025.
- The Wall Street Journal argued earlier this month that Walmart’s stock had reached a valuation around 40 times forward earnings, an unusual premium for a legacy retailer, and noted the view that Nasdaq-related passive flows could support demand. [6]
- Independent valuation trackers show Walmart trading around ~39x earnings (methodologies differ by provider), underscoring how elevated the multiple has become versus many consumer staples peers. [7]
Bottom line: when valuation is rich, incremental negative headlines—lawsuits, recalls, regulatory notices—can matter more to near-term price action than they would for a cheaper stock.
The bull case: why Walmart has been winning (and why some analysts stay optimistic)
Despite the day’s pressure, Walmart’s underlying operating story remains one of the market’s most closely watched into 2026. Several themes keep showing up in recent earnings coverage and analyst notes:
Omnichannel scale + faster delivery
Walmart’s advantage is no longer just low prices and physical reach; it’s how the store footprint feeds e-commerce fulfillment and speed. In Walmart’s most recent reported quarter, Reuters highlighted:
- U.S. comparable sales +4.5%, beating estimates
- Revenue up 5.8% to $179.5B
- Online sales up 28%
- “Expedited deliveries” rising sharply, as higher-income shoppers used convenience services more heavily [8]
Advertising: Walmart Connect is increasingly central to the investment story
High-margin advertising is a major reason investors tolerate a higher multiple.
A Motley Fool analysis distributed via Nasdaq pointed to Walmart’s fiscal Q3 (ended Oct. 31) showing:
- Global advertising growth of 53%
- Walmart Connect U.S. growth of 33% [9]
And the broader retail-media market is expected to keep expanding. EMARKETER projected retail media ad spending rising meaningfully in 2026 and argued that Amazon and Walmart are taking the bulk of incremental growth—supporting the notion that Walmart Connect could remain a structural winner. [10]
AI and automation: efficiency narrative gains credibility
In the same Q3 coverage, Reuters noted management commentary around AI-assisted software development and automation in distribution and fulfillment—part of the margin/efficiency narrative investors increasingly reward. [11]
Walmart stock forecast: what analysts expect next (price targets and earnings outlook)
Consensus price targets (12-month)
Analyst targets move daily, but the broad picture heading into year-end is:
- MarketBeat reports a $120.54 average 12‑month target, with estimates ranging from $91 (low) to $135 (high). That implies mid-to-high single-digit upside from recent trading levels—though it also reflects that Walmart is no longer viewed as “cheap.” [12]
Recent target hikes to watch
Several firms have recently pushed targets higher, reflecting confidence in Walmart’s execution and mix shift:
- A note carried by TipRanks/The Fly says Wells Fargo raised its target to $130 while maintaining an Overweight stance. [13]
- Investing.com also reported DA Davidson lifting its Walmart price target to $130 (with a Buy rating) in late November. [14]
Earnings trajectory and the “setup” for 2026
From a fundamentals standpoint, Walmart already reset expectations higher going into the holiday season. Reuters reported the company raised full-year guidance again in November, including:
- Net sales growth outlook lifted to 4.8%–5.1%
- Adjusted EPS outlook lifted to $2.58–$2.63 [15]
And looking ahead, MarketBeat lists Walmart’s next earnings report as expected in February 2026 (date/time subject to confirmation by the company). [16]
Risks for Walmart stock in 2026: what could go wrong
Even many bullish notes acknowledge a set of risks that could weigh on margins or sentiment:
Legal and regulatory overhangs
The ByHeart recall story is a reminder that large retailers can face exposure not only as sellers but also through recall execution and reputational risk—issues that can drag on for months. [17]
Pharmacy headwinds tied to “Maximum Fair Pricing” (IRA)
Recent Walmart coverage flagged potential pharmacy impacts from “maximum fair pricing” changes beginning in January 2026—a reference to Medicare drug price negotiation implementation under the Inflation Reduction Act that affects pricing for certain drugs. [18]
Tariffs and consumer mix
Walmart’s scale helps it defend value leadership, but it’s still exposed to:
- cost pressures and tariffs
- mix shifts toward lower-margin essentials
- a consumer backdrop where spending patterns differ by income bracket [19]
Valuation: the “room for error” problem
One of the most repeated caution flags in late-2025 analysis is simple: Walmart can be a great business and still be a risky stock if the entry price assumes too much perfection. With the stock trading around ~39–40x earnings by several measures, even small disappointments (growth deceleration, margin pressure, slower advertising ramp) can cause outsized volatility. [20]
Management transition: a major narrative into early 2026
Investors are also preparing for a leadership handoff. Reuters reported that longtime Walmart executive John Furner is set to take over as CEO after Doug McMillon retires, with the transition expected in February 2026. [21]
Leadership changes rarely move a stock alone, but when combined with premium valuation and big strategic bets (AI, automation, ads, marketplace), the market tends to watch early messaging and capital allocation signals closely.
The takeaway for WMT stock on Dec. 23, 2025
Walmart stock’s dip today fits the current pattern: premium-valued winners can still be sensitive to “headline shocks,” especially those involving product safety, recalls, and litigation. Yet the longer-term debate hasn’t changed much—Walmart is being rewarded for building higher-margin businesses (advertising, memberships, services) on top of its massive retail base, while bears argue the stock price already bakes in a large share of that upside.
What to monitor next (short list)
- Updates on the ByHeart litigation and any retailer-specific allegations or settlement signals [22]
- Evidence that Walmart Connect and membership income continue compounding (and supporting margins) [23]
- Any clarity on pharmacy impacts from maximum fair pricing changes starting January 2026 [24]
- CEO-transition messaging as the Furner era begins [25]
- Whether valuation cools (or holds) as 2026 expectations reset [26]
This article is for informational purposes only and does not constitute investment advice.
References
1. www.nasdaq.com, 2. www.reuters.com, 3. www.fda.gov, 4. news.bloomberglaw.com, 5. www.reuters.com, 6. www.wsj.com, 7. stockanalysis.com, 8. www.reuters.com, 9. www.nasdaq.com, 10. www.emarketer.com, 11. www.reuters.com, 12. www.marketbeat.com, 13. www.tipranks.com, 14. www.investing.com, 15. www.reuters.com, 16. www.marketbeat.com, 17. www.reuters.com, 18. www.nasdaq.com, 19. www.reuters.com, 20. stockanalysis.com, 21. www.reuters.com, 22. news.bloomberglaw.com, 23. www.nasdaq.com, 24. www.nasdaq.com, 25. www.reuters.com, 26. www.wsj.com
