Walmart Inc. (WMT) has spent decades selling you paper towels and rotisserie chickens. Now Bank of America thinks it can sell something else: your attention. The bank reiterated a Buy rating on the retail giant Monday with a $126 price forecast, arguing that Walmart's digital advertising push, connected TV ambitions and AI shopping integrations could unlock billions of dollars in ad revenue.

Analyst Christopher Nardone wrote up the thesis after meeting with Walmart Connect executive Ryan Mayward, and the takeaway is that Walmart is getting better at pulling advertising dollars away from competing platforms.

Why advertisers are paying attention

The pitch is simple enough. Walmart sees roughly 150 million shoppers every week. That gives advertisers valuable consumer insights and, perhaps more importantly, a way to measure whether their ads actually worked. If you bought the toothpaste, the ad probably did its job.

Then there's the marketplace. Walmart keeps adding tens of thousands of third-party sellers, and those sellers are a fresh source of advertising revenue. Bank of America estimates marketplace sellers typically spend 10% to 12% of gross merchandise value on advertising, compared with 4% to 6% for traditional Walmart suppliers. That's a meaningful gap, and it explains why the marketplace is more than just a way to stock more stuff.

Connected TV: the multibillion-dollar bet

Walmart's acquisitions of Vizio in December 2024 and Vibe.co in August 2026 expand its reach beyond brands that sell products through its stores and marketplace. Vibe's self-service platform lets small and midsize businesses launch and measure streaming TV campaigns using Walmart's consumer data. Nardone believes those advertisers could represent a multibillion-dollar opportunity over the longer term.

Walmart's investment in Vizio's WatchFree+ streaming service also provides additional advertising inventory, which is a fancy way of saying more places to put ads.

AI shopping and Sam's Club

Bank of America sees Walmart as a potential beneficiary of AI-powered shopping because of its integrations with multiple AI platforms. The retailer runs its own AI shopping assistant, Sparky, and has partnered with external platforms, including Meta Platforms, Inc.'s (META) Muse.

But Nardone cautioned that it remains too early to determine how AI shopping agents will reshape advertising. Fair enough. The robots are still learning.

Meanwhile, Walmart is moving Sam's Club's U.S. advertising operations onto Walmart's technology platform. The integration could encourage brands to increase advertising spending across Walmart, Sam's Club and international markets.

Valuation and risks

Bank of America's $126 price forecast reflects 40 times its fiscal 2028 adjusted earnings estimate, above Walmart's average forward earnings multiple of 36 over the past two years. The premium reflects expectations for continued market share gains, stronger store traffic and operating income growth approaching twice the pace of sales growth.

However, the firm identified slowing food inflation, tougher competition and weaker global retail conditions as potential risks to its outlook.

Walmart price action

WMT Price Action: Walmart shares were down 0.05% at $118.74 at the time of publication on Monday, according to market data.