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Investing.com - KeyBanc has reiterated its Sector Weight rating on Target (NYSE:TGT), the $44 billion retail giant, following the retailer’s second-quarter results and announcement of an upcoming CEO transition. According to InvestingPro analysis, Target currently trades below its Fair Value, suggesting potential upside opportunity.
Target announced that Michael Fiddelke will become CEO on February 1, 2026, replacing Brian Cornell who will be retiring from the role. Fiddelke brings over 20 years of experience with the company, having started as a finance intern and progressed through various leadership positions, including his appointment as CFO in 2019 and COO in 2024. Under the current leadership, Target has maintained its impressive 54-year streak of consecutive dividend increases, as noted in InvestingPro’s analysis.
KeyBanc analyst Bradley Thomas noted that Target’s second quarter was "uneventful" and essentially met investor expectations. However, the firm indicated that investors might have preferred an external candidate for the CEO position to accelerate change at the retailer.
The key question facing Fiddelke, according to KeyBanc, will be how quickly he can implement and successfully drive change at Target, which has been experiencing ongoing same-store sales declines. The firm acknowledged agreement with Fiddelke’s three key priorities but indicated it needs to see more detailed plans and execution.
KeyBanc expressed that while both consumers and Target could be in a better position by 2026, the retailer still faces a highly competitive environment with Walmart (NYSE:WMT) and Amazon (NASDAQ:AMZN) continuing to gain market share.
In other recent news, Target’s second-quarter earnings report has drawn varied responses from analysts. The company reported a 1.9% decline in comparable sales and a 19% year-over-year decrease in profit, with traffic dropping by 1.3%. Despite these figures, Target’s earnings were in line with expectations, and the company maintained its previous guidance. Mizuho (NYSE:MFG) reiterated its Neutral rating with a $94 price target, citing concerns over leadership decisions following the appointment of Michael Fiddelke as CEO. Evercore ISI lowered its price target to $106 while maintaining an "In Line" rating, noting Target’s loss of market share despite managing near-term profit pressure better than expected. Wells Fargo (NYSE:WFC), however, kept an Overweight rating and a $115 price target, despite investor disappointment regarding the CEO announcement. Bernstein raised its price target slightly to $87, maintaining an Underperform rating, pointing out the margin pressure from a gap between brick-and-mortar sales and e-commerce growth. Meanwhile, BMO Capital maintained its Market Perform rating with a $95 price target, observing that investor reaction to the quarterly results was subdued.
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