Big-box retailer Target (TGT) is scheduled to announce its results for the second quarter of Fiscal 2025 on Wednesday, August 20. TGT stock has plunged 24% year-to-date due to concerns about the impact of macro pressures on consumer spending, tariff woes, and intense competition. The backlash related to the retailer’s rollback of key diversity, equity, and inclusion (DEI) initiatives also hurt TGT’s business and impacted investor sentiment. Ahead of Q2 earnings, Wall Street is cautious on Target stock, with the average price target indicating that shares are fully priced at current levels.
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Meanwhile, the consensus Q2 FY25 earnings per share (EPS) estimate of $2.04 indicates about a 21% year-over-year decline. Wall Street expects revenue to fall by 2% to $24.93 billion, as weakness in traffic is expected to persist.
Analysts’ Views Ahead of Target’s Q2 Earnings
Heading into Q2 earnings, Telsey analyst Jason Strominger reiterated a Hold rating on Target stock with a price target of $100. Strominger maintained his Q2 2025 estimates of comparable sales decline of 3.5% and a 14% drop in EPS to $2.22. He also retained his 2025 comparable sales outlook of a 2.5% decline and a 13% fall in EPS to $7.71. The analyst explained that his estimates reflect soft consumer spending, mainly on discretionary goods, higher costs, including promotions and investments in labor and technology, and potential tariff pressure.
Strominger also cited negative traffic trends in the second quarter and thinks that Target appears to be losing share to players like Amazon (AMZN), Costco (COST), and Walmart (WMT). He expects these negatives to be partially offset by TGT’s focus on value, loyalty, and strategic initiatives, including those related to private brands, new stores and remodeling, and supply chain enhancements.
Last week, Bank of America Securities analyst Robert Ohmes downgraded Target stock to Sell from Hold and lowered the price target to $93 from $105. The 5-star analyst noted rising longer-term sales and margin risks for the company due to slowing digital sales growth and a lack of scale in digital advertising and third-party marketplace. Ohmes also highlighted elevated tariffs, pricing and merchandising headwinds, and intense competition from Walmart and Amazon.
Is TGT Stock a Buy, Sell, or Hold?
Overall, Wall Street is cautious on Target stock, with a Hold consensus rating based on 11 Buys, 17 Holds, and four Sell recommendations. The average TGT stock price target of $103.28 indicates shares are fully priced at current levels.
