Competitive EnvironmentWe remain cautious and Market Perform-rated as we see increasing risk that Target needs a more significant investment in supply chain or selection given rising competitive pressures from Walmart, Amazon, & Instacart.
Economic And Inflationary PressuresRecent challenges such as inflationary pressure and slower move of inventory given the economic pressure, could have certain impacts on Target’s margins.
Guidance And PerformanceTGT closed down 3% (vs. the S&P 500 at -1.2%) after a 4Q beat and lower-than-expected FY25 top line guidance, while EPS guidance was relatively in-line with consensus expectations.