Barclays cuts Target stock price target to $102 from $140

On Monday, Barclays (LON:BARC) analyst Seth Sigman adjusted the price target on Target Corporation (NYSE:TGT) shares, bringing it down to $102 from the previously set $140, while maintaining an Equalweight rating. The revision reflects expectations for a challenging first quarter, as Sigman noted that a weak Q1 performance seems to be largely anticipated by the market. According to InvestingPro data, 13 analysts have recently revised their earnings downward for the upcoming period, while the stock currently trades at an attractive P/E ratio of 11.12x, suggesting potential value opportunity.

Sigman’s commentary pointed to several factors influencing the revised outlook. He highlighted concerns over a potential decline in transaction volumes, which have historically supported Target’s market performance but now appear to be diminishing. This trend could introduce additional risk to the company’s stock valuation. Moreover, Sigman observed that Target’s performance gap compared to other mass merchants has widened, suggesting a slowdown in consumable goods as well. Despite these challenges, InvestingPro analysis shows Target maintains a ’GOOD’ financial health score, with strong dividend credentials including 54 consecutive years of dividend increases.

The analyst also remarked on the reversal of multi-year market share gains Target has made since 2020, expressing uncertainty about how the company will alter this trajectory. In light of these concerns, Sigman anticipates that Target may need to present a more aggressive strategy to rejuvenate its business operations.

Barclays has also updated its upside and downside scenarios for Target’s stock. The downside scenario suggests a price as low as $70, assuming a weaker earnings per share (EPS) in the $7 range, which would equate to a 10x multiple. Conversely, the upside scenario points to a potential high of $152, based on a 16x multiple of an EPS power of $9.50. With the stock currently trading at $98.58, InvestingPro’s Fair Value analysis suggests Target is currently undervalued. Subscribers can access 10 additional ProTips and comprehensive valuation metrics in the Pro Research Report.

Sigman’s analysis anticipates that Target will need to address these challenges head-on, especially if the company’s underperformance is as significant as indicated by the tracker mentioned in his commentary. The market will be looking closely at Target’s upcoming plans to address the issues outlined and whether they will be sufficient to reinvigorate the company’s growth.

In other recent news, Target Corporation has been the focus of several analyst assessments and discussions around tariff impacts. Telsey Advisory Group adjusted its price target for Target to $130 from $145, maintaining an Outperform rating. This revision was due to concerns about consumer spending and additional costs, though Telsey remains optimistic about Target’s strategic initiatives. In contrast, Citi analysts raised their price target slightly to $97 but kept a Neutral stance, citing a slow start to February sales and potential withdrawal of full-year EPS guidance due to market uncertainties.

Morgan Stanley (NYSE:MS) maintained an Overweight rating with a $160 target, highlighting Target’s valuation as favorable compared to peers despite challenges. They noted Target’s focus on expanding eCommerce and loyalty programs, although these initiatives might increase costs. Meanwhile, CFRA downgraded Target from Buy to Hold, reducing the price target to $100, driven by economic challenges and tariff risks. They also revised down their EPS estimates for fiscal years 2026 and 2027.

In other developments, President Trump is set to meet with major retailers, including Target, to discuss the impact of tariffs. The meeting aims to address concerns over potential price increases and operational slowdowns due to import taxes. This comes as consumer behavior shifts, with increased purchases of items like cars and electronics in anticipation of tariff implementations.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.