Big-box retailer Target is set to announce its Q1 earnings results on Wednesday, May 21. The stock has dropped over 26% year-to-date, pressured by weak consumer spending, inventory and supply chain issues, tariff impacts, and stiff competition in retail. Wall Street analysts expect the company to report earnings of $1.63 per share in Q1, down 20% year-over-year.
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However, revenues are expected to remain flat at $24.4 billion, according to data from the TipRanks Forecast page. It’s important to highlight that TGT has missed the consensus EPS estimates twice in the last nine quarters.
Analysts’ Views on TGT Ahead of Q1 Results
Ahead of Target’s Q1 results, Barclays analyst Seth Sigman maintained a Hold rating on the stock and decreased the price target to $102 from $140 per share, expecting a soft Q1 largely driven by weaker transaction trends and slowing consumer demand.
Sigman noted that although tariff concerns have eased, Target still faces pressure, with demand for consumables appearing to slow compared to rivals. Also, Target’s multi-year market share gains since 2020 appear to be reversing, with limited signs of improvement on the horizon. Given these challenges, he believes Target will need to take more aggressive steps to reignite growth.
Also, Telsey Advisory’s five-star analyst Joe Feldman lowered his 12-month price target on the stock from $145 to $130, citing weak demand for discretionary and general merchandise. He also noted rising expenses tied to labor and technology investments, and select promotions. However, Feldman remains optimistic about the company’s long-term prospects and therefore kept a Buy rating on the stock. Notably, the company has been making strategic investments in physical locations, supply chain, and technology to boost sales. According to Main Street Data, Target operated approximately 1,978 stores in the United States in Q4 2024.
Options Traders Anticipate a Large Move
Using TipRanks’ Options tool, we can see what options traders are expecting from the stock immediately after its earnings report. The expected earnings move is determined by calculating the at-the-money straddle of the options closest to expiration after the earnings announcement. If this sounds complicated, don’t worry, the Options tool does this for you.
Indeed, it currently says that options traders are expecting a 10.13% move in either direction.
Is Target Stock a Good Buy?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on TGT stock based on 10 Buys, 16 Holds and two Sells assigned in the past three months, as indicated by the graphic below. The average TGT price target of $119.04 per share implies 21.48% upside potential.
