Walmart Stock Soars 72% in 2024, Best Year Since 1998

BENTONVILLE, Ark. — Walmart Inc. (NYSE: WMT) saw its stock surge 72% in 2024, marking its best annual performance since 1998. The retail giant’s shares outperformed the S&P 500, which gained 23% during the same period, as the company’s digital transformation and membership growth drove record profits.

CEO Doug McMillon attributed the success to strong growth in e-commerce, advertising, and membership income. “Globally, we drove strong growth in e-commerce, up 27%. Advertising grew 28%, and membership income was up 22%. This helped us grow profits faster than sales,” McMillon said during the company’s third-quarter earnings call.

Walmart’s membership program, Walmart+, launched in 2020, has been a key driver of its digital growth. By September 2022, the program had over 60 million subscribers, according to financial media outlet PYMNTS. The company has maintained a double-digit growth rate since then, with estimates suggesting it could soon reach 100 million subscribers.

The rise in e-commerce sales, fueled by Walmart+ subscriptions, has also boosted the company’s advertising revenue. Walmart’s e-commerce platform, which hosts third-party sellers, has become a significant profit center, mirroring strategies employed by rival Amazon.

Despite the stock’s impressive performance, some investors question whether Walmart is overvalued. The company’s price-to-earnings (P/E) ratio currently exceeds its 10-year average of 28, as well as the S&P 500’s average P/E ratio. However, analysts argue that Walmart’s above-average profit growth justifies the higher valuation.

Looking ahead, McMillon expressed optimism about continued growth in 2025. “Growth rates such as this usually don’t abruptly hit a wall. Rather, if there’s a slowdown, growth tends to taper off gradually,” he said. Analysts predict that Walmart’s digital business, including e-commerce, advertising, and membership income, will continue to drive profits, potentially allowing the stock to outperform the S&P 500 again in 2025.

While another 72% gain in 2025 seems unlikely, Walmart’s ongoing digital transformation positions it for sustained growth. As the company expands its digital footprint, investors remain optimistic about its ability to deliver strong returns in the years to come.