Target (TGT) Stock Forecast & Price Target

Target's strong financial performance is underscored by a 25% growth in same-day services, significantly driving digital sales, particularly through Target Circle 360. The company reported an increase of 1.5% in comparable sales and a 2.1% rise in traffic, while digital channel growth of 8.7% indicates robust online performance amidst a cautious consumer environment. Additionally, Target anticipates modest EBIT margin expansion in 2025, reflecting a positive outlook for overall profitability and operational efficiency.

Target has experienced a sequential decline in card penetration by 10 basis points during the recent quarter, following a previous decline of 30 basis points. The company's retail gross margin has remained stable at 26.2%, but this marks a year-over-year decrease of 40 basis points, attributed to increased digital fulfillment costs and higher markdown rates, which raises concerns about profitability. Furthermore, Target anticipates a small year-over-year sales decline in the first quarter and significant EBIT pressure, reflecting broader weakness in consumer confidence and discretionary spending trends.