Why Target Is an Analyst's 'Top Pick' After Its Stock Plunged

Target (TGT) shares jumped Monday aft analysts astatine Oppenheimer named nan banal a “top pick” a week aft nan retailer’s disappointing third-quarter net study sent shares swooning.

Oppenheimer said Target shares “appear to beryllium at/near a bottom” aft nan banal dropped astir 20% connected quarterly results that missed expectations and included a reduced full-year forecast. The patient issued a “buy” standing and $165 value target for Target, astir a 30% premium to Friday's adjacent and supra nan Visible Alpha mean of adjacent $144.

The banal climbed much than 4% connected Monday to supra $130. Year-to-date, however, nan stock is down astir 8%.

Digital Efforts Should Help successful nan Longer Term

Oppenheimer would "take advantage of immoderate dips amidst a still difficult discretionary backdrop,” nan analysts wrote. “Longer term, we judge nan institution is good positioned to seizure share driven by integer efforts, shop investments, merchandising occurrence connected nan exclusive marque front, competitor liquidations complete time, and partnerships pinch different brands/retailers.”

Comparable integer income were a agleam spot of Target’s net report, climbing 10.8% twelvemonth complete year, while comparable shop sales dropped 1.9%.

The retailer acknowledged earlier this twelvemonth that higher prices had driven immoderate customers away and precocious announced a schedule of regular and play income that will tally done nan vacation season.