Target (TGT, Financial) has announced an enhancement to its Target Circle 360 program, aiming to deliver greater value to its members by eliminating price markups for same-day deliveries. This perk now extends beyond Target's own offerings to include over 100 popular retailers and grocery stores. Previously, Target's same-day delivery service was free of additional charges, but the update broadens this benefit to more locations, enhancing convenience and affordability.
Unlike other memberships that tie users to a single retailer, Target Circle 360 grants members unlimited access to same-day delivery services through both Target and Shipt's curated marketplace. This includes major retailers such as CVS, PetSmart, and Lowe’s Home Improvement, as well as regional grocery chains like Hy-Vee, Lowes Foods, and Giant Eagle. Target Circle 360 effectively becomes a virtual shopping mall, providing a seamless shopping experience where members can purchase both Target essentials and beloved local products without incurring delivery surcharges. This strategic move by Target aims to meet the needs of busy members, ensuring they can receive their desired items promptly and without extra cost.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 31 analysts, the average target price for Target Corp (TGT, Financial) is $119.19 with a high estimate of $160.00 and a low estimate of $82.00. The average target implies an upside of 20.91% from the current price of $98.58. More detailed estimate data can be found on the Target Corp (TGT) Forecast page.
Based on the consensus recommendation from 39 brokerage firms, Target Corp's (TGT, Financial) average brokerage recommendation is currently 2.6, indicating "Hold" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Target Corp (TGT, Financial) in one year is $154.26, suggesting a upside of 56.48% from the current price of $98.58. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Target Corp (TGT) Summary page.
TGT Key Business Developments
Release Date: March 04, 2025
- Revenue Growth: Target expects to drive more than $15 billion in revenue growth over the next five years.
- Beauty Sales Growth: Nearly 7% sales growth and share gains in the Beauty category.
- Apparel Share Gains: Apparel grew share over the last three quarters.
- Digital Business Growth: $20 billion digital business with nearly 9% growth in Q4.
- New Store Openings: Plans to open more than 20 new stores in 2025.
- Target Plus Marketplace: $1 billion marketplace growing at a double-digit pace.
- Traffic Growth: 2%-plus traffic growth in Q4 and a 20% uptick in traffic since 2019.
- Target Circle Membership: Added 13 million members in 2024.
- Q4 Comparable Sales: 1.5% increase in Q4 comp sales.
- Q4 EPS: Reported Q4 GAAP and adjusted EPS of $2.41.
- 2024 Net Sales Growth: Approximately 1% growth over 2023.
- 2024 EPS Growth: Approximately 3% growth over 2023, adjusting for the 53rd week in 2023.
- Target Plus GMV Growth: More than 35% growth in third-party GMV on Target Plus last year.
- Roundel Growth: Mid-teens growth in Roundel ad business.
- Operating Margin Rate: Expecting a modest increase in operating margin rate in 2025.
- Capital Expenditure: Expected CapEx of $4 billion to $5 billion in 2025.
- Dividend Increase: Plan to recommend a low single-digit increase in the quarterly dividend.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Target Corp (TGT, Financial) reported a 1.5% increase in Q4 comp sales, exceeding initial expectations.
- The company plans to invest $4 billion to $5 billion in stores, supply chain, and technology to enhance consumer experience.
- Target Plus, the company's marketplace, has grown by 35% in the past year and is expected to reach $5 billion in GMV over the next five years.
- Target's digital business is profitable and continues to grow, with nearly 9% growth in Q4.
- The company has seen significant growth in its loyalty program, Target Circle, which added 13 million members in the past year.
Negative Points
- Target Corp (TGT) experienced a sales decline in February due to economic uncertainty and consumer caution in discretionary spending.
- The company faces challenges with inventory levels, which were up over 7% at the end of Q4.
- There is ongoing volatility in consumer spending, particularly in discretionary categories, impacting predictability.
- Target is dealing with potential tariff impacts, which could affect pricing and supply chain dynamics.
- The company anticipates outsized profit pressures in Q1 due to tariff uncertainty and startup costs from new stores and remodel projects.
