Target’s turnaround efforts gain traction
Target’s (TGT) turnaround strategy has picked up the pace and is expected to support the company’s sales and earnings growth in future quarters. Also, Bank of America Merrill Lynch analyst Robert Ohmes has listed Target as one of the bank’s top stock picks.
Ohmes expects Target’s turnaround efforts to accelerate this year, which could expand its market share. Also, the company’s value offerings could attract aging Millennials, and its healthy dividend yield (3.5% as of June 8) and lower valuation make it an attractive bet.
Target’s growth measures, such as expanding delivery options for online orders, launching exclusive brands, and remodeling stores, are expected to drive the company’s comps and profitability in future quarters. However, costs associated with the company’s growth initiatives are hurting its margins, and in turn, its growth.