: Walmart+ will add 10 million members by the end of 2021: UBS

Walmart+ could add billions in sales, analysts say.

Walmart

UBS analysts forecast that Walmart Inc.’s WMT, +0.50% new membership program, Walmart+, will attract 10 million members by the end of next year.

Walmart+, which launched on Sept. 1, costs $12.95 per month or $98 per year. A key offering is unlimited delivery.

If each of these 10 million members were to spend an incremental $100 per month, it would add $12 billion in additional sales through this channel in a year.

“These members should contribute incremental spend, enabling Walmart to sustain healthy growth from its e-commerce segment,” analysts led by Michael Lasser wrote.

Read: Target to focus on fulfilling digital orders from stores, contactless options this holiday season

A third of consumers that UBS polled between Sept. 3 and Sept. 8 said they were likely to sign up for the service.

Nearly a quarter of respondents (22%) indicated they shop at a Walmart store more than once a week and 17% shop on the retail giant’s e-commerce site more than once per week.

However, it will cost money to add all of those members. UBS estimates the cost at $200 million to $300 million in 2021.

Watch: Why retail bankruptcies won’t necessarily create a ‘retail apocalypse’

Analysts note that American customers are becoming more comfortable with subscription services, with Amazon.com Inc.’s AMZN, +1.63% Prime program boasting about 112 million members.

UBS rates Walmart shares buy with a $148 price target.

Walmart stock is up 15.3% for the year to date while the Dow Jones Industrial Average DJIA, +0.47% is down 5.8% for the period.

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