Target Corporation

TGT
Financial Analysis · Updated May 12, 2026 · Coverage 2026-Q2
Latest Q Revenue
$30.0B
Q4 FY2025 · -1% YoY
TTM ROIC
13.8%
FY2025 · NOPAT / Invested Capital; NOPAT = Operating Income × (1 − effective tax rate); Invested Capital = Total Debt + Equity − Cash · WACC ~9.2% · Moat spread +4.6pp
Margin Profile
Gross 27.2%
Operating 4.9%
FCF 2.7%
FY2025
Net Debt
$9.1B
Cash $5.5B · Debt $14.6B · FY2025

Business Overview

ticker: TGT step: 01 generated: 2026-05-12 source: quick-research

Target Corporation (TGT) — Business Overview

Business Description

Target Corporation is the seventh-largest US retailer operating ~1,963 stores across the United States. Differentiates from Walmart and Amazon via cheap-chic merchandising ("Tar-zhay"), strong private-label brands, store-as-hub fulfillment model, and discretionary-skewed product mix (apparel, home, beauty, electronics).

Revenue Model

~$106.6B FY2024 (fiscal Jan 2025) revenue across merchandise sales (95%+) plus credit card finance income, marketplace, and high-margin advertising (Roundel) + membership (Target Circle 360). Roundel hit ~$2B in 2024, targeted to double by 2030. Target Plus marketplace from $1B → $5B+ targeted by 2030.

Products & Services

  • Stores (~1,963 locations) — One-stop shopping; ~97% of digital orders fulfilled from stores
  • Owned brands — $30B+ in high-margin private labels (Good & Gather, Cat & Jack, Threshold, Up&Up)
  • Drive Up + Order Pickup + Same-day — Same-day services accelerating; Shipt grocery delivery
  • Target Plus — Third-party marketplace ($1B → $5B target by 2030)
  • Roundel — In-house retail media network ($2B → $4B+ target by 2030)
  • Target Circle 360 — Paid membership (~$99/yr) competing with Amazon Prime, Walmart+

Customer Base & Go-to-Market

Middle/upper-middle-income suburban families. ~78 of top 100 stores in Tier 1 markets. Stronger discretionary mix than Walmart (more apparel/home/beauty). Loyalty: Target Circle has 100M+ members. Tariff exposure significant — large share of apparel + hardlines sourced overseas.

Competitive Position

#7 US retailer; massive scale but losing market share to Walmart (groceries) + Amazon (convenience). Wins in cheap-chic discretionary, private brands, store experience, and Target Circle 360 ecosystem. New CEO Michael Fiddelke (Feb 2026, succeeding Brian Cornell) eliminating 1,800 corporate roles + $5B investment plan in remodels + AI + supply chain.

Key Facts

  • Founded: 1902 (Dayton Dry Goods); Target brand 1962
  • Headquarters: Minneapolis, MN
  • Employees: ~415,000
  • Exchange: NYSE (TGT)
  • Sector / Industry: Consumer Discretionary / General Merchandise Retail
  • Market Cap: ~$50B (declined from $80B peak)

Financial Snapshot

ticker: TGT step: 04 generated: 2026-05-12 source: quick-research

Target Corporation (TGT) — Financial Snapshot

Income Statement Summary

Metric FY2022 FY2023 FY2024 FY2025 YoY (25)
Revenue $109.1B $107.4B $106.6B $106.6B -0.8%
Comp Sales +2.2% -3.7% +0.1% -1.0%
Operating Margin 3.5% 5.3% 5.2% 4.8%
Operating Income $3.85B $5.71B $5.57B $5.13B -8%
GAAP EPS $5.98 $8.94 $8.86 $8.13 -8%
Adjusted EPS $6.02 $8.94 $8.86 $7.57 -15%

FY2025 (Fiscal Year ending Feb 2026) showed comparable sales decline -1.0% reflecting -2.5% in Q4. Discretionary categories pressuring overall comp. Operating margin -40 bps YoY.

Cash Flow & Balance Sheet (FY2024 = fiscal year ending Feb 2025)

Metric Value
Operating Cash Flow ~$7.4B
Capex ~$3.0B
Free Cash Flow ~$4.4B
Cash & Equivalents ~$4.4B
Total Debt ~$15.7B
Dividend $4.48/share (~3.9% yield)

Key Ratios (approximate)

  • P/E: ~13x | EV/EBITDA: ~8x | FCF Yield: ~9%
  • Revenue Growth (TTM): -0.8% | Op Margin: ~4.8%
  • Dividend Yield: ~3.9% | Buybacks: ~$1B annual

Growth Profile

Revenue declining for 2 years on weak discretionary + customer trade-down. Long-term plan: $15B+ sales growth by 2030 via Target Circle 360 + Target Plus marketplace + Roundel media + grocery + store remodels + ~20 new stores/yr. Trading at distressed valuation (~13x P/E, 9% FCF yield) reflecting market skepticism.

Forward Estimates

  • FY 2025 (ending Feb 2026): Comp sales -1% to flat; adj EPS $7.50-8.00
  • FY 2026 (ending Feb 2027): Initial guide flat to +1% comp; adj EPS ~$8.00-8.50
  • Fiddelke's $5B investment in remodels/AI/supply chain to drive multi-year recovery
  • 53rd consecutive year of dividend increases (Dividend King)

Deeper Financial Analysis

The fundamental tier adds 9 additional research dimensions for $TGT.

Revenue Breakdown
Segment revenue, geographic mix, product-line contribution margins, and cohort dynamics.
Financial Trends
Quarter-over-quarter momentum, leading indicators, and inflection point analysis.
Balance Sheet
Debt structure, liquidity runway, dilution risk, and working capital dynamics.
Capital Allocation
Buyback cadence, M&A appetite, dividend policy, and reinvestment priorities.
Returns on Capital (ROIC)
Multi-year ROIC vs. WACC, marginal returns on reinvestment, sales-to-invested-capital efficiency, and moat spread.
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