Target downgraded to Underperform at BofA on sales and margin risks

BofA downgraded Target (TGT) to Underperform from Neutral with a price target of $93, down from $105. Target is now underperforming Walmart (WMT) on a comparable sales compound annual growth rate vs. 2019 and digital trends “look very challenged,” the analyst tells investors. The firm sees increasing longer-term sales and margin risks given slowing digital sales growth, a lack of scale in digital advertising and third-party marketplace, elevated tariff, pricing and merchandising headwinds, and increasing competitive threats from both Walmart and Amazon (AMZN), the analyst added.