Retail giant Walmart Inc. (WMT) recently announced the pricing of its first green bonds worth $2 billion. The company intends to use the net proceeds from the offering to fund the existing and future projects that enable it to achieve its sustainability goals.
Following the news, shares of the company declined marginally to close at $147.27 in extended trade on Wednesday.
The company has plans to allocate an amount equal to the net proceeds of the $2-billion offering toward a portfolio of Eligible Green Investments in the near future. The investments will have to meet certain conditions within the areas of renewable energy, high-performance buildings, sustainable transport, zero waste and circular economy, water stewardship, and habitat restoration and conservation.
The company will also issue a public report with information on allocation and the estimated impact of the Eligible Green Investments on an annual basis. (See Walmart stock chart on TipRanks)
Recently, Morgan Stanley analyst Simeon Gutman reiterated a Buy rating on the stock with a price target of $170, which implies upside potential of 15.3% from current levels.
According to the analyst, the company’s GoLocal service can be an attractive alternative revenue earning stream for the company in addition to Walmart Connect (advertising), fintech, healthcare, Walmart+ and Walmart Fulfillment Services/Marketplace buildout.
Consensus among analysts is a Strong Buy based on 18 Buys and 4 Holds. The average Walmart price target of $172.48 implies upside potential of 17% from current levels.
Walmart scores a “Perfect 10” from TipRanks’ Smart Score rating system, indicating that the stock has strong potential to outperform market expectations. Shares have gained 5.4% over the past year.