Good morning, investors. It’s not every trading day that a new company joins the 13-digit club.

But Walmart’s meteoric rise is unique for both how long it took as well as how rapidly it sprinted through the finish line.

I found the math mind blowing.

Walmart just joined the trillion-dollar club.

A 13.2% gain to start the year pushed the retailer past the $1 trillion mark on Tuesday, reflecting Wall Street’s willingness to value Walmart less as a traditional retailer and more as a technology-driven enterprise.

Incredibly, Walmart took 62 years to reach $500 billion in market value, yet it added the next $500 billion in roughly two years. 

The steep increase in its share price and market cap validates its pivot from a brick-and-mortar chain to an AI-driven logistics giant — a transformation initiated by Doug McMillion and passed on to the newly tapped CEO John Furner. 

AI sits at the core of that parabolic trajectory, with executives pushing to implement the new technology across the company’s vast physical footprint and customer touch-points. 

Machine learning and AI now guides inventory tracking, pricing decisions, delivery routes and customer service.

That makes Walmart one of the few mega-caps that have moved beyond the experimental stage of AI and into active deployment and monetization. 

At Walmart’s size, incremental productivity gains — through automation, reduced logistic costs or a smaller labor force — can move the needle in an outsized way. 

No surprise, then, that Walmart has managed to gain market share and increase profits even as consumers become increasingly sensitive to inflation and affordability.

“As a trillion dollar company, Walmart also now trades at 49.3 times its trailing 12-month EPS,” said researchers at Bespoke Investment Group.

“That sounds more like a high-growth Tech stock multiple rather than a big-box Consumer Staples stock.”

Indeed, the bull-case for Walmart a couple years ago didn’t look particularly asymmetrical. 

At the time, Wall Street still viewed it as a defensive play with solid cash flows and limited upside.

Few investors then publicly called for it to double its market cap. 

Suddenly, Walmart sits alongside Berkshire Hathaway as one of the only global giants that isn’t a conventional technology name. 

Again, only in hindsight can we claim it’s unsurprising that Walmart’s scale, data, and distribution were each perfectly positioned for an AI-fueled catalyst.  

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📈Walmart joined the $1 trillion club. The stock moved 3% higher to pass the milestone for the first time ever Tuesday, bringing its year-to-date gains to 12% as it capitalizes on consumers’ search for value shopping. (Bloomberg)

🚀Palantir shares rallied big the day after earnings. It guided first-quarter revenue of $1.5 billion, above expectations, and expects full-year revenue of $7.2 billion, also above expectations. (Yahoo Finance)

📉 Bitcoin is trading near its lowest levels in over a year. It briefly dipped below $73,000 to bring its 12-month decline to about 17%. Michael Saylor’s Strategy, meanwhile, fell 4.9% Tuesday. (CNBC)

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🗓 February 4, 1971: The NASDAQ stock exchange was created as the first fully electronic stock market, and it went on to become the world’s second largest exchange.

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