Walmart vs. Target: Which Is the Better Long-Term Play?
Key Points
Walmart and Target have around 5,200 and 2,000 stores in the U.S., respectively.
Walmart's focus on low prices helps it thrive during good and bad economic times.
Most Americans live within a reasonable distance of a Walmart store.
- 10 stocks we like better than Walmart ›
When it comes to brick-and-mortar retail, Walmart (NASDAQ: WMT) and Target (NYSE: TGT) have a stronghold in the U.S., serving millions of consumers daily. However, the stocks have been on two different paths lately.
If you're interested in investing in a retail stock and have to choose between the two for the long haul, Walmart stands out as the better choice.
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Image source: Getty Images.
Walmart has a few advantages over Target when it comes to long-term success. First, it has always positioned itself as the place to go for value and bargains, helping it cater to lower-income and budget-conscious shoppers. This helps Walmart thrive in both a thriving and a slumping economy.
Target, on the other hand, has positioned itself as a more premium brand, and many of its prices reflect that. If money is tight, consumers have no issue skipping Target and heading to Walmart for deals.
Target also can't compete with Walmart's overall reach. It has over 5,200 U.S. stores, compared to Target's roughly 2,000. Many big cities in the country have Targets, but they're not that common in many parts of rural America. However, you can venture almost anywhere in the country and find a Walmart within a reasonable distance (except New York City).
That footprint gives Walmart a logistical advantage that no other retailer can compete with and it's my pick in this matchup.
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Stefon Walters has positions in Walmart. The Motley Fool has positions in and recommends Target and Walmart. The Motley Fool has a disclosure policy.
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