Walmart shares close lower on Friday, retailer may acquire controlling stake in Flipkart this week, sources say

April 23, 2018 9:32 am

According to a report by Reuters on Friday, citing two sources with knowledge of the situation, Walmart Inc (WMT) may strike a deal over the acquisition of a 51% stake in India’s Flipkart as early as this week.

Walmart shares closed lower for the second time in the past six trading sessions on Friday. It has also been the steepest daily loss since April 6th. The stock went down 1.04% ($0.91) to $86.98, with the intraday high and the intraday low being at $88.38 and $86.67 respectively.

In the week ended on April 22nd the shares of the retail chain added 1.12% to their market value compared to a week ago, which marked the first gain out of three weeks.

The stock has extended its loss to 2.24% so far during the current month, following a 1.16% decrease in March. The latter has been a second straight month of losses.

For the entire past year, the shares of the NYSE-listed retailer went up 42.87% following another 12.76% surge in 2016.

The retailer finalized its due diligence on Flipkart and had offered to acquire 51% or more of the Indian on-line marketplace for about $10 billion to $12 billion.

Japan’s SoftBank Group, which holds a 20% stake in Flipkart via its Vision Fund, was previously not willing to part sell its shares, as Walmart’s buy offer ($12 billion) was considered not high enough.

According to one of the sources, however, that impasse between Walmart and the Japanese tech investor was no longer present.

According to Reuters, other major shareholders in Flipkart such as South Africa’s Naspers, USA’s Tiger Global Management and venture equity firm Accel may fully exit as their shares are bought by Walmart.

One of the persons familiar with the matter also said that Sachin Bansal and Binny Bansal, who established Flipkart in 2007 in Bengaluru, may part sell their shares under the terms of the agreement.

According to CNN Money, the 31 analysts, offering 12-month forecasts regarding Walmart Inc’s stock price, have a median target of $103.00, with a high estimate of $126.00 and a low estimate of $90.00. The median estimate is an 18.42% surge compared to the closing price of $86.98 on April 20th.

The same media also reported that 19 out of 35 surveyed investment analysts had rated Walmart Inc’s stock as “Hold”, while 13 – as “Buy”.

Daily and Weekly Pivot Levels

With the help of the Camarilla calculation method, today’s levels of importance for the Walmart stock are presented as follows:

R1 – $87.14
R2 – $87.29
R3 (Range Resistance – Sell) – $87.45
R4 (Long Breakout) – $87.92
R5 (Breakout Target 1) – $88.47
R6 (Breakout Target 2) – $88.70

S1 – $86.82
S2 – $86.67
S3 (Range Support – Buy) – $86.51
S4 (Short Breakout) – $86.04
S5 (Breakout Target 1) – $85.49
S6 (Breakout Target 2) – $85.26

By using the traditional method of calculation, the weekly levels of importance for Walmart Inc (WMT) are presented as follows:

Central Pivot Point – $87.22
R1 – $88.32
R2 – $89.66
R3 – $90.76
R4 – $91.86

S1 – $85.88
S2 – $84.78
S3 – $83.44
S4 – $82.10

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