Telsey Consulting Group Analyst Joseph Feldman reiterates his rating for outperformance Target company (NYSE: TGT), lowering the price forecast from $145 to $130.
Target will report its first-quarter earnings on Wednesday, May 21. Analyst Feldman lowered his target's first-quarter and full-year estimates, citing weaker consumer spending, especially in terms of discretionary and general commodities, and cost increases related to promotions, labor, technology investments, and potential tariff impacts.
While Placer.ai’s data showed a decline in traffic early in the quarter, with some recovery later on, which may be due to improved Easter timing and weather, Feldman noted Target’s efforts in value products, loyalty programs, private label expansion, store upgrades and brand partnerships (Apple (NASDAQ: AAPL), Walt Disney Company (NYSE:DIS), Levi Strauss & Co (NYSE: LEVI), Ulta Beauty, Inc. (NASDAQ:ULTA)) can partially offset the pressure.
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Feldman now expects total sales to be 0.9% to $24.3 billion, with comparable sales down 1.5% below the previous forecast of 1.0% and below the FACTSET consensus of a 1.2% decline.
Feldman noted that the target source is about 50% of the cost of goods it sells from the United States, while reducing its dependence on 60% in 2017 to about 30% in 2024, with plans to reduce it below 25% by 2026. Although the company has not quantified the impact of tariffs, it plans to purchase approximate sales volumes, while increasing sales volumes, while increasing short selling and increasing sales volumes, while this range increases volume and increases prices.
Feldman reflects softer consumer demand, weaker product portfolios, and increased cost pressures, especially tariffs, and his 2025 EPS estimate is expected to drop to $8.80, from $9.30 (with Factset’s $8.62) and 2026 EPS to $9.55, from $10.14 (relative to Factset’s $9.20).
Price action: TGT stock traded 1.68% to $98.62 on Friday.
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| date | company | action | from | arrive |
|---|---|---|---|---|
| March 2022 | Raymond James | persist in | Buy strongly | |
| March 2022 | JP Morgan | persist in | overweight | |
| March 2022 | German Bank | persist in | purchase |
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