Spoiler alert: Walmart’s prices lowest to varying degrees

Pricing studies conducted this week by Wall Street analysts yielded familiar results.

Deutsche Bank analyst Charles Grom and Citigroup analyst Deb Weinswig issued reports this week comparing Walmart’s prices to dollar stores and conventional supermarkets and Target.

Grom’s assessment looked at two Dollar General, Family Dollar and Walmart stores in a major Northeastern metropolitan area. He compared a basket of 27 comparable items and determined Walmart was the lowest at $82.75, compared to $83.65 at Dollar General and $87.15 at Family Dollar. The spread versus Dollar General was only 1.1% and 5.3% versus Family Dollar.

"While a small sample size, we believe these checks continue to illustrate that Dollar General remains focused on price investment to drive traffic, a strategy that has paid dividends as the comp gap with peers continues to widen," Grom said. "All told, while the three remain highly competitive in the new markets we visited, Walmart and Dollar General are clearly ahead of Family Dollar on price, though to less of an extent than we had witnessed previously."

Meanwhile, on the other side of the country, the pricing situation revealed by Citigroup’s Weinswig was slightly different as she looked at prices at conventional supermarkets, Target and Walmart stores in the Los Angeles area. Walmart continues to enjoy a material pricing advantage relative to food retailers, but remains challenged by Target where shoppers who take advantage of the company’s loyalty program can pay less than they would at Walmart.

Weinswig observed the gap with SuperValu contracted somewhat, but expanded with Kroger and Safeway. Despite narrowing with SuperValu, the food chain remains 18.5% above Walmart while Kroger was 16.9% higher than Walmart and Safeway was 22.4% higher. However, Target was only 2.4% higher than Walmart, but was actually 2.7% lower for Target shoppers who participate in the retailer REDcard Rewards program which provide a 5% price break at the point of sale.

"Consistent with our prior survey, we believe that the supermarkets in our coverage universe are focused on keeping pace with Walmart’s price investments as they continue to fight for share of the food retail pie, while Target works to gain its footing on price in food," according to Weinswig.