Bernstein favors Amazon, Walmart, Costco for recession resilience

A new report from Bernstein suggests that some retailers are better prepared to handle a potential recession. The report highlights companies like Amazon, Walmart, and Costco. These retailers have strong membership programs that help retain customers even in tough times. This analysis comes after consumer confidence dipped to a 12-year low, according to the Conference Board. A recent survey also showed that consumer sentiment has not been this low since 2022. Concerns about the economy are growing. The issues are compounded by President Trump's upcoming tariffs on imports, which could add to consumer strain. Bernstein analyst Nikhil Devnani noted that companies that can balance membership loyalty and gross merchandise value will stand out in the e-commerce space. Amazon recently surpassed Walmart in revenue for the first time. Costco, known for its bulk savings, aims to keep prices stable amid rising costs. Bernstein maintains a positive outlook on Amazon, Walmart, and Costco. They set a target price of $275 for Amazon, suggesting potential growth of 35%. Walmart's target is $113, indicating a possible 29% rise, while Costco's target of $1,177 suggests over 27% upside. Despite this positive outlook, Bernstein remains cautious about the broader e-commerce sector. Many stocks in this area have fallen about 15% since February. Devnani emphasized uncertainty, as investors are trying to navigate the changing economic landscape.