UBS analysts forecast that Walmart Inc.’s WMT,
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.
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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.
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Analysts note that American customers are becoming more comfortable with subscription services, with Amazon.com Inc.’s AMZN,
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,