Oppenheimer Steps to the Sidelines on Walmart Ahead of Earnings

Oppenheimer downgraded Walmart from outperform to perform on Tuesday, saying Wall Street's confidence in the retailer leaves little room for upside heading into its fiscal second-quarter report on August 20.

The firm flagged pharmacy headwinds in the Walmart U.S. business and a valuation that looks peakish, with shares trading around 37 times forward earnings versus a historical average closer to 23 times.

Oppenheimer cautioned that the stock could move lower in reaction to results even if the quarter itself is solid — a reminder that expectations, not just execution, drive returns at these multiples.