Target logged a 1.9% change during today's afternoon session, and is now trading at a price of $135.19 per share.
The company's 50-day average price is $138.32. Target Corporation operates as a general merchandise retailer in the United States. Based in Minneapolis, MN, the large-cap Consumer Discretionary company has 440,000 full time employees. Target has offered a 3.1% dividend yield over the last 12 months.
Increasing Revenues but Narrowing Margins:
| 2020-01-31 | 2021-01-31 | 2022-01-31 | 2023-01-31 | |
|---|---|---|---|---|
| Revenue (MM) | $78,112 | $93,561 | $106,005 | $109,120 |
| Gross Margins | 29.8% | 29.3% | 29.3% | 24.6% |
| Operating Margins | 6.0% | 7.0% | 8.4% | 3.5% |
| Net Margins | 4.2% | 4.67% | 6.55% | 2.55% |
| Net Income (MM) | $3,281 | $4,368 | $6,946 | $2,780 |
| Net Interest Expense (MM) | -$477 | -$977 | -$421 | -$478 |
| Depreciation & Amort. (MM) | -$2,604 | -$2,485 | -$2,642 | -$2,700 |
| Earnings Per Share | $6.36 | $8.64 | $14.1 | $5.84 |
| EPS Growth | n/a | 35.85% | 63.19% | -58.58% |
| Diluted Shares (MM) | 516 | 505 | 493 | 462 |
| Free Cash Flow (MM) | $4,090 | $7,876 | $5,081 | -$1,510 |
| Capital Expenditures (MM) | -$3,027 | -$2,649 | -$3,544 | -$5,528 |
| Net Current Assets (MM) | -$18,044 | -$16,052 | -$19,411 | -$24,257 |
| Current Ratio | 0.89 | 1.03 | 0.99 | 0.92 |
| Long Term Debt (MM) | $11,338 | $11,536 | $13,549 | $16,009 |
| Net Debt / EBITDA | 1.23 | 0.46 | 0.65 | 2.11 |
Target benefits from growing revenues and increasing reinvestment in the business, wider gross margins than its peer group, and decent operating margins with a negative growth trend. The company's financial statements show generally positive cash flows and healthy leverage. However, the firm has declining EPS growth.
Target's Valuation Is in Line With Its Sector Averages:
Target has a trailing twelve month P/E ratio of 23.7, compared to an average of 22.33 for the Consumer Discretionary sector. Based on its EPS guidance of $10.17, the company has a forward P/E ratio of 13.6. The 9.8% compound average growth rate of Target's historical and projected earnings per share yields a PEG ratio of 2.41. This suggests that these shares are overvalued. Furthermore, Target is likely overvalued compared to the book value of its equity, since its P/B ratio of 5.38 is higher than the sector average of 3.12. The company's shares are currently trading 92.4% above their Graham number.
Analysts Give Target an Average Rating of Buy:
The 31 analysts following Target have set target prices ranging from $130.0 to $220.0 per share, for an average of $173.44 with a buy rating. As of April 2023, the company is trading -20.2% away from its average target price, indicating that there is an analyst consensus of strong upside potential.
Target has an average amount of shares sold short because 2.2% of the company's shares are sold short. Institutions own 81.7% of the company's shares, and the insider ownership rate stands at 0.2%, suggesting a small amount of insider investors. The largest shareholder is Vanguard Group Inc, whose 9% stake in the company is worth $5,714,939,967.
