Amazon Just Made a Big Move. These 2 S&P 500 Stocks Are Next to Watch.

Why It Matters

Strong consumer demand is reshaping retail earnings expectations, making Walmart and TJX key bellwethers for the sector’s performance and valuation outlook.

Key Takeaways

• Walmart e‑commerce sales jumped 24% YoY in FY Q4
• Walmart expects FY Q1 sales $172B, earnings $0.66 EPS
• Walmart's AI assistant Sparky lifts order spend 35%
• TJX expects FY Q1 sales $13.9B, earnings $1.00 EPS
• TJX's forward P/E of 30 suggests reasonable valuation

Pulse Analysis

Amazon’s recent 15% year‑over‑year e‑commerce growth signals a broader consumer rebound, driven in part by a 10% rise in tax refunds. This influx of disposable income is reigniting demand across the retail spectrum, prompting investors to reassess which stocks will capture the upside. While Amazon remains the market leader, its growth rate now mirrors a more mature phase, setting the stage for competitors with differentiated strategies to shine.

Walmart is leveraging its massive brick‑and‑mortar footprint while accelerating online sales, which surged 24% YoY in the fiscal fourth quarter—far outpacing Amazon’s 8% increase. The retailer’s AI‑powered Sparky assistant is boosting average order values by roughly 35%, underscoring how technology can enhance shopper spend. However, a forward P/E of 45 raises concerns about pricing relative to single‑digit earnings growth, suggesting investors must weigh growth against valuation risk.

TJX Companies continues to thrive on its off‑price model, delivering consistent sales growth even in inflationary environments. Forecasts point to a 6.5% rise in Q1 sales to $13.9 billion and earnings of $1.00 per share, supported by strong inventory availability and expanding international footprints in Europe, Mexico, and the Middle East. With a forward P/E near 30, TJX appears modestly priced, offering a potentially attractive entry point for investors seeking exposure to resilient, value‑oriented retail.