Walmart shares close little changed on Monday, retailer reportedly discussing $25 billion investment in upcoming “super app” by Tata Group

According to a report by the Mint newspaper, citing sources with knowledge of the matter, Walmart Inc (WMT) is discussing with Tata Group an investment of up to $25 billion in the Indian company’s “super app,” which is expected to launch in India either in December or in January.

The report stated the app was to link all of Tata’s consumer divisions – grocery, fashion, healthcare, electronics and insurance.

Walmart shares closed lower for the fourth time in the past ten trading sessions in New York on Monday. The stock inched down 0.01% ($0.02) to $137.25, after touching an intraday high at $138.04, or a price level not seen since September 23rd ($139.24).

Shares of Walmart Inc have risen 15.49% so far in 2020 compared with a 3.74% gain for the benchmark index, S&P 500 (SPX).

In 2019, Walmart’s stock went up 27.58%, thus, it underperformed the S&P 500, which registered a 28.88% gain.

“Walmart is keen to get a strong brand backing its e-commerce business, while Tata group wants a global name and an established player in the online space … to be able to compete against Reliance Industries’ Jio Platforms and Amazon,” one of the sources said for Mint.

Goldman Sachs has been hired to advise Walmart on the financial aspects of the proposed deal, which, according to Mint, could be in the form of a joint venture managed by Tata.

Meanwhile, Bloomberg reported that Tata Group was in talks with potential investors over stake purchases in the conglomerate’s digital platform.

Analyst stock price forecast and recommendation

According to CNN Money, the 31 analysts, offering 12-month forecasts regarding Walmart Inc’s stock price, have a median target of $148.00, with a high estimate of $175.00 and a low estimate of $105.00. The median estimate represents a 7.83% upside compared to the closing price of $137.25 on September 28th.

The same media also reported that at least 19 out of 33 surveyed investment analysts had rated Walmart Inc’s stock as “Buy”, while 6 – as “Hold”. On the other hand, 1 analyst had recommended selling the stock.