How Wall Street Analysts View Target Stock
Ratings summary and target price
Most analysts covering Target stock (TGT) expect to maintain a neutral outlook, as the company’s strategic initiatives to drive balanced top-line and bottom-line growth are expected to take time. Competitors have upped their games, which could hurt the company’s sales and profitability in the near term, with Amazon (AMZN) acquiring Whole Foods (WFM) and Walmart (WMT) adopting the omnichannel approach.
Target is expected to report muted growth in fiscal 2017 as soft sales, increased price investments, and higher SG&A expense rates are projected to restrict its growth rate.
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Analysts maintained a consensus score of 3.1 on Target stock on a scale of 1 (“strong buy”) to 5 (“strong sell”). Moreover, 12% of the 25 analysts covering the stock recommended a “buy,” 68% maintained a “hold,” and 20% rated it a “sell.” On August 9, 2017, Target stock was trading almost on par with analysts’ 12-month price target of $58.38.
Analysts maintained a positive outlook on Costco (COST) stock, given the company’s stellar top-line performance amid industry challenges. Costco’s unique ability to fund its growth programs with increased savings without affecting its margins lifted analysts’ sentiments. Currently, 66% of the 29 analysts covering Costco stock maintained a “buy,” and 34% recommended a “hold.”
As for Walmart, analysts preferred to remain on the sidelines as persistent industry-wide challenges and expansion of Amazon in the grocery space could restrict its growth rate. Of the 33 analysts covering Walmart stock, 39% gave it a “buy” rating, 52% recommended a “hold,” and 9% maintained a “sell” rating.