Compared to the company Sam Walton founded, Walmart (NYSE:WMT) today is fast becoming unrecognizable. Under the guidance of CEO Doug McMillon, the world's largest retailer is reinventing itself by pivoting toward growth markets and creating a Walmart that will thrive in the future. These days, the company is becoming much more than the low-priced, big-box retailer that most Americans think of it as.

Though Walmart stock is down 14% this year, due to a sell-off following slowing e-commerce growth in its fourth quarter, the stock is still up considerably since McMillon first announced the company's turnaround strategy in October 2015, up 44% since then and nearly 90% earlier this year.

Let's take a look at a few ways Walmart is reinventing itself and stacking the deck against the competition.

A Walmart grocery pickup station

Image source: Walmart.

Smart portfolio strategy

Just in the last month or so, Walmart has made three big moves to reorient its international portfolio toward growth. First, the company said at the end of April it would merge its British subsidiary, Asda, with grocer Sainsbury in a deal that allows the retail giant to cash out much of its stake in the U.K. market. Walmart will hold 42% of the combined company and will receive $4 billion from the deal. 

The move accomplishes several goals for Walmart, including giving it an exit from Asda, which had been struggling and losing sales in a cutthroat British market, combining it with Sainsbury to yield a stronger business, and dealing a blow to Amazon (NASDAQ:AMZN) in the process, which counts the U.K. as one of its foreign markets. Cashing out $4 billion in its investment in Asda also allowed Walmart to redeploy that firepower elsewhere, and it did so less than two weeks later.

Walmart followed up the Asda deal with a blockbuster $16 billion investment in Flipkart, taking a 77% stake in the leading Indian e-commerce operator and giving the company a huge stake in the fast-growing Indian online retail market. Investors actually jeered the news, sending shares down, as it will weigh on Walmart's bottom line in the near term. But India is expected to be the world's second-biggest economy, and if Walmart leverages its partnership with Flipkart effectively, it should be a major player on the subcontinent. Once again, this tie-up dealt a blow to Amazon, which has already pledged to invest $5 billion in the Indian market, as the company is a big believer in the growth opportunity there. 

Finally, just this week, Walmart said it would sell 80% of its Brazil business, which has also struggled amid a recession and high inflation, to private equity firm Advent International. Walmart could receive a payment of $250 million from Advent, depending on the business's performance. More importantly, the decision allows the company to unload a problem area and focus on growth markets.

E-commerce growth

Under McMillon, Walmart has also made huge strides in e-commerce. The company plans to have more than 2,000 grocery pickup stations by the end of the year, and it has made several acquisitions to beef up its online retail capabilities, including Jet.com, most importantly, as well as Bonobos, Modcloth, Moosejaw, and Shoebuy. Last year, Walmart's U.S. e-commerce sales grew by 44%, and the company expects the key figure to increase by another 40% this year.

E-commerce growth has become essential for brick-and-mortar retailers in this day and age as consumers have gotten used to the convenience of shopping from home or from their smartphones. At 40% online sales growth, Walmart is outperforming virtually all of its peers, and, though it will likely never catch Amazon, it is taking at least a modest amount of market share from the e-commerce leader.  The company has also rolled out programs like free two-day shipping for orders of $35 or more, offering a version of Amazon Prime without the annual $119 shipping fee, and experimenting with other tactics like pickup towers in order to make the most of its store base. 

With more locations than any of its rivals, including KrogerCostco, and Target, the company's expansion of grocery pickup should help it maintain its leadership in grocery and keep Amazon, with its takeover of Whole Foods, at bay.

More experimentation

Walmart just launched a new personalized shopping service in New York City called Jetblack. Led by Rent the Runway co-founder Jenny Fleiss, the new program "offers its members the ability to text nearly any shopping request and Jetblack will find the right products and deliver them the same or next day for no additional charge." Jetblack is the first invention to come out of the company's technology incubator, Store No. 8, established by Marc Lore, the founder of Jet.com and Walmart's CEO of U.S. e-commerce.

Lore has also pushed the company to think like a start-up in other ways as the company has several other secretive projects in Store No. 8, and he's focused on ways to get the customer more savings with ideas like Pickup Discount and the smart-basket technology he brought from Jet. 

Walmart already has built-in advantages like economies of scale and an unmatched distribution network that only became stronger with its more recent moves. The company's efforts to refocus its business on growth markets, boost its e-commerce business, and experiment to expand its reaches beyond its traditional customer base should make life more difficult for its competitors. 

The market may still be skeptical, as the stock trades at a modest P/E valuation of less than 20, but the decisions above should make the company more competitive over the long term.

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Jeremy Bowman owns shares of Kroger. The Motley Fool owns shares of and recommends Amazon. The Motley Fool recommends Costco Wholesale. The Motley Fool has a disclosure policy.