Telsey Downgrades Target (TGT) on Persistent Headwinds and Execution Concerns, Cuts PT

Following Target Corp.’s (NYSE:TGT) Q1 results, an analyst from Telsey Advisory downgraded his rating on the shares to Market Perform from Outperform and reduced the price target to $110, down from $130.

The broad reasons for the downgrade were partly attributed to the challenging operating environment, including the potential impact of tariffs. Moreover, the analyst pointed to the company’s weak execution and a lack of clarity on its growth initiatives. While these issues have been headwinds for some time, the analyst was disappointed by the weak performance in the year's first quarter and the softer guidance for the rest of the year, which dented his confidence in the investment case. Therefore, he turned cautious and downgraded the rating.

On May 21, the company reported net sales of $23.8 billion for Q1 2025, representing a 2.8% decline year-over-year. Comparable sales, on the other hand, declined 3.8%, with comparable store sales down 5.7%. The decrease was partially offset by comparable digital sales growth of 4.7%. Management also lowered its guidance to a low-single-digit decline in sales, from the earlier guide of 1% growth.

Target Corp. (NYSE:TGT) is a general merchandise retailer with nearly 2,000 stores across the United States.

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