CNBC's Jim Cramer argues that Walmart Inc.'s recent 20% stock slide was a massive overreaction to past energy fears, calling the dip an "incredible buying opportunity." With the threat of high gas prices fading and unexpected tariff refunds looming, the retail giant is primed for a major "reprieve." Cramer emphasized that fears of an oil-induced slowdown in consumer spending have "gone out the window" as the national average for gas dropped from $4.56 to $3.79 in a matter of weeks.

Market Disconnect

Walmart's stock tumbled on May 21 and July 2, initially driven by a softer short-term outlook during its last earnings call. However, Cramer contends that analysts are "jumping to the wrong darn conclusion" by assuming expensive fuel would permanently crush consumer spending at the retail giant. The dreaded "nightmare" economic environment has not materialized, and the negative sentiment has "gotten ahead of itself."

Strategic Price Cuts

Beyond falling fuel costs, Walmart is aggressively lowering prices on thousands of items to celebrate America's 250th birthday. The retailer's aggressive markdown strategy earned praise from President Donald Trump, who urged other companies to "follow the lead of these absolute Patriots." Additionally, a recent Supreme Court decision overturning previous tariffs will result in significant refunds for the company, which Cramer expects management to use to fund even deeper price cuts.

Stock Performance

Walmart shares were up only 0.12% year-to-date, down 6.17% over the last month, and higher by only 12.27% over the year. The stock closed 0.80% higher at $111.54 apiece on Tuesday and was up 0.49% in overnight trading. Benzinga's Edge Stock Rankings indicate that WMT maintains a weak price trend in the long, short, and medium terms, with a good quality score.

JPMorgan analyst Christopher Horvers suggests the first wave of agentic AI will create distinct winners and losers in the retail sector. Retailers and brands that control checkout, fulfillment, and customer relationships may strengthen their competitive positions, while grocery retailers face the greatest disruption as AI automates routine shopping.

Retailers poised to benefit

Wall Street's concern has centered on AI assistants like ChatGPT standing between retailers and consumers. However, JPMorgan believes this risk has eased after OpenAI moved away from its Instant Checkout model. AI platforms are increasingly acting as a more potent version of searching, helping consumers discover products while purchases continue through retailer-controlled checkout.

This shift favors companies positioned to own more of the shopping journey. JPMorgan identifies Walmart Inc. as leading the pack with its Sparky AI assistant and integrations with third-party Large Language Models (LLMs) for product discovery, basket building, and checkout.

Meanwhile, Apple Inc. and Nike, Inc. represent brands with established direct-to-consumer businesses. These companies could increasingly steer shoppers to their own channels, allowing them to capture the full retail margin.

Grocery sector faces risks

Not every retail category stands to benefit from these advancements. JPMorgan places grocery at the top of the risk bucket because repetitive, low-consideration purchases are well-suited for automated replenishment.

Additionally, AI improves price discovery, making it easier for consumers to compare products. This capability could potentially increase pricing pressure on grocery retailers. Categories where browsing is part of the experience—such as beauty, home furnishings, and pet products—remain relatively insulated.

Strategic implications

JPMorgan's analysis indicates agentic AI is not replacing retailers but reshaping how consumers find them. Retailers that invest to win with major LLMs while building their own AI agents stand to strengthen customer acquisition, improve shopping experiences, and preserve ownership of valuable customer data.

For investors, the focus shifts away from which AI model wins. The companies best positioned for the agentic AI era may simply be the ones that continue to own the customer after the AI conversation ends.