It hasn't been a great year for retail stocks. While the benchmark S&P 500 has gained 18.63% so far this year, retail stocks, represented by the S&P Retail SPDR ETF (XRT) , have gained just 9.98% year to date.
Shares of Walmart (WMT) are also trailing the large-cap index this year, but with a gain of 12.34%, at least the world's largest retailer is beating most of its peers in the retail sector.
Walmart's recent climb is accelerating, with a robust 7% gain in the month of June. As of Monday's close, Walmart was trading less than 1% below its all-time closing high of $159.87, set on April 21 of last year.
Is it time for investors to put shares of Walmart in their shopping cart? Let's go to the charts to find out.
Walmart's chart features a bullish pattern known as an ascending triangle (black dotted lines). This massive pattern began forming last spring, and projects a large move higher for the stock, which could eventually reach $200.
Chart Source: TradeStation
Walmart is trading well above its 50-day (blue) and 200-day (red) moving averages. The 200-day MA, currently located near $146, provides significant support, as it overlays the stock's bullish trendline.
The stock's volume has been below average over the past few months (shaded yellow), but that type of behavior is normal during a consolidation. Should the stock break above $160, a significant increase in volume would be needed to confirm the breakout.
Walmart (blue) is also outperforming many of its brick-and-mortar peers. Year to date, Walmart is trouncing fellow big box retailers Target ( (TGT) , red), Home Depot ( (HD) , black), and Best Buy ( (BBY) , green).
Chart Source: TradeStation
When Walmart reports earnings next month, analysts will be looking for signs of clarity regarding a game plan for its Walmart Plus service.
Conceived as an alternative to Amazon Prime (AMZN) , Walmart Plus offers free shipping on groceries, discounts on fuel, and other perks. Unfortunately, Walmart Plus has failed to gain traction, with membership figures stagnant in the 11.5 million range over the past year.
That figure pales in comparison with Amazon Prime's 200 million subscribers. You probably heard about Amazon's Prime Day earlier this month, as the annual event generated $12.7 billion in sales in just 48 hours. Meanwhile, Walmart Plus Week, which overlapped Prime Day, went largely unnoticed.
Walmart's chart looks great, and the stock could soon reach an all-time high. If the company can put together a cogent plan for Walmart Plus, the stock would be even more attractive.
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