Overview

• US mass merchandiser's Q1 sales rose 6.7%, beating analyst expectations

• Q1 net income exceeded analyst estimates; adjusted EPS rose 32% from prior-year adjusted figure

• Company raised 2026 net sales growth outlook to around 4%

Outlook

• Target sees 2026 net sales growth around 4%, up two points from prior range

• Company expects 2026 operating income margin rate over 20 bps above 2025 adjusted margin

• Target projects 2026 GAAP and Adjusted EPS near high end of $7.50-$8.50 range

Result Drivers

• BROAD-BASED SALES GROWTH - Co said sales growth was strong across all merchandise categories, sales channels and throughout the quarter

• DIGITAL SALES - Digital comparable sales grew 8.9%, led by more than 27% growth in same-day delivery powered by Target Circle 360

• NON-MERCHANDISE REVENUE - Non-merchandise sales grew nearly 25%, reflecting strong growth in Roundel ad revenue, Target Circle 360 membership revenue, and the Target+ marketplace

Company press release: ID:nPnbnRW3da

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "hold" and the breakdown of recommendations is 12 "strong buy" or "buy", 24 "hold" and 3 "sell" or "strong sell"

• The average consensus recommendation for the discount stores peer group is "buy."

• Wall Street's median 12-month price target for Target Corp is $126.00, about 1% above its May 19 closing price of $127.24

• The stock recently traded at 15 times the next 12-month earnings vs. a P/E of 14 three months ago

For questions concerning the data in this report, contact Estimates.Support@lseg.com. For any other questions or feedback, contact reuters.support@thomsonreuters.com.