From Yahoo Finance: 2025-05-24 06:25:00

Target missed estimates and cut its guidance in its first-quarter earnings report, facing challenges in recent years. Management’s turnaround efforts have failed, and the stock price fell 39% over the last three years. Comparable sales dropped 3.8%, revenue fell to $23.85 billion, and adjusted EPS fell to $1.30.

Weak performance was due to declines in discretionary sales, especially in home furnishings. Consumer sentiment and boycotts affected Target’s performance. The company cut its full-year adjusted EPS guidance and sales guidance, struggling to compete with rivals like Walmart.

Target faces challenges with tariffs and a sluggish macro environment. An enterprise formation office was established to improve the turnaround strategy. The company lacks clarity on how to fix declining sales and struggles to engage with customers effectively.

While facing difficulties, Target still has strengths like omnichannel capabilities and a strong brand. The stock price fell 5.2% after the earnings report, but the dividend yield is 4.8%. Despite challenges, investors may find value in Target’s stock price.

Target’s performance may improve in the future, but a turnaround is unlikely until next year. The company’s challenges are reflected in the stock price, which trades at a forward P/E of less than 12. Target remains a Dividend King with a well-funded dividend.

Investors should consider the Motley Fool’s top 10 stock picks, excluding Target. The Stock Advisor team has a track record of market-crushing returns. While Target struggles, other opportunities may provide better returns for investors.

Read more: Target Stock: Time to Panic?