Target (TGT) closed at $99.23 in the latest trading session, marking a +1.67% move from the prior day. The stock outperformed the S&P 500, which registered a daily gain of 0.52%. On the other hand, the Dow registered a gain of 1%, and the technology-centric Nasdaq increased by 0.52%.
Heading into today, shares of the retailer had gained 2.88% over the past month, outpacing the Retail-Wholesale sector's gain of 2.37% and lagging the S&P 500's gain of 5.95%.
The investment community will be closely monitoring the performance of Target in its forthcoming earnings report. It is anticipated that the company will report an EPS of $2.05, marking a 20.23% fall compared to the same quarter of the previous year. At the same time, our most recent consensus estimate is projecting a revenue of $24.86 billion, reflecting a 2.34% fall from the equivalent quarter last year.
For the annual period, the Zacks Consensus Estimates anticipate earnings of $7.51 per share and a revenue of $104.59 billion, signifying shifts of -15.24% and -1.85%, respectively, from the last year.
Investors might also notice recent changes to analyst estimates for Target. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the business outlook.
Our research shows that these estimate changes are directly correlated with near-term stock prices. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.
The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.08% lower. Target currently has a Zacks Rank of #3 (Hold).
Looking at valuation, Target is presently trading at a Forward P/E ratio of 13. For comparison, its industry has an average Forward P/E of 20.99, which means Target is trading at a discount to the group.
Investors should also note that TGT has a PEG ratio of 2.81 right now. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. By the end of yesterday's trading, the Retail - Discount Stores industry had an average PEG ratio of 2.81.
The Retail - Discount Stores industry is part of the Retail-Wholesale sector. Currently, this industry holds a Zacks Industry Rank of 159, positioning it in the bottom 36% of all 250+ industries.
The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
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Target Corporation (TGT): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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