Target (TGT) closed at $111.30 in the latest trading session, marking a +1.62% move from the prior day. The stock exceeded the S&P 500, which registered a loss of 0.84% for the day. Elsewhere, the Dow lost 0.34%, while the tech-heavy Nasdaq lost 1.43%.
The retailer’s stock has climbed by 7.28% in the past month, exceeding the Retail-Wholesale sector’s gain of 6.19% and the S&P 500’s gain of 1.8%.
Market participants will be closely following the financial results of Target in its upcoming release. In that report, analysts expect Target to post earnings of $2.16 per share. This would mark a year-over-year decline of 10.37%. Our most recent consensus estimate is calling for quarterly revenue of $30.54 billion, down 1.22% from the year-ago period.
For the full year, the Zacks Consensus Estimates are projecting earnings of $7.3 per share and revenue of $104.87 billion, which would represent changes of -17.61% and 0%, respectively, from the prior year.
Investors should also pay attention to any latest changes in analyst estimates for Target. Recent revisions tend to reflect the latest near-term business trends. Consequently, upward revisions in estimates express analysts’ positivity towards the business operations and its ability to generate profits.
Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. To exploit this, we’ve formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.05% lower within the past month. Target currently has a Zacks Rank of #3 (Hold).
Investors should also note Target’s current valuation metrics, including its Forward P/E ratio of 14.15. This denotes a discount relative to the industry average Forward P/E of 26.71.
It’s also important to note that TGT currently trades at a PEG ratio of 11.23. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company’s expected earnings growth trajectory. The Retail – Discount Stores industry currently had an average PEG ratio of 2.87 as of yesterday’s close.
The Retail – Discount Stores industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 45, which puts it in the top 19% of all 250+ industries.
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