Shares in Ranpak Holdings (PACK) motored over 20% higher today after sealing a “transformative” deal with retail giant Walmart (WMT).
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Ranpak, which is a sustainable packaging automation solutions, artificial intelligence (AI), vision, and robotics business, revealed a major expansion of its existing relationship with Walmart.
AI Fulfilment
Under the terms of the deal, Walmart will install numerous AI-powered Ranpak AutoFill systems across its five Next Generation Fulfillment Centers. The aim is to speed up the fulfilment process for customers, reduce packaging waste, and simplify work for its staff.
At the moment, Walmart uses the Ranpak AutoFill machines at its McCordsville fulfillment center. This will now expand to include Greencastle, Joliet, Lancaster, and Stockton.
“Our collaboration with Walmart represents a significant milestone for Ranpak as we continue to scale our automation capabilities to meet the needs of the world’s largest retailers,” said Omar Asali, Chairman and CEO of Ranpak. “Walmart’s ongoing investment in automation reflects our shared commitment to reducing friction for associates while optimizing performance across every stage of the supply chain.”
It should also be a huge boost for the company’s share price, which has huffed more than puffed this year – see below.
Greg Palm, analyst at Craig-Hallum raised his price target on Ranpak to $10 from $8 and kept a Buy rating after the “transformative-like deal significantly broadened its relationship and made it a preferred protective packaging vendor for this retail giant.”
AI Boost
The deal also enhances Walmart’s technology and more specifically its AI and delivery capabilities. It recently announced it was rolling out four so-called “super agents”, which would be powered by agentic AI.
For ordinary shoppers, it means helping them find new products, accelerating delivery times and helping make returning products an easier process. By doing so it hopes to take share away from Amazon and power its e-commerce business forward.
Indeed, it wants e-commerce to hit 50% of total sales – see below – within five years.
“At Walmart, we are constantly seeking solutions that increase speed of service for our customers and simplify work for our associates,” said Vik Gopalakrishnan, Senior Vice President of Automation Engineering at Walmart.
Is PACK a Good Stock to Buy Now?
On TipRanks, PACK has a Moderate Buy consensus based on 1 Buy and 1 Hold ratings. Its highest price target is $8. PACK stock’s consensus price target is $6.50, implying a 12.46% upside.
