TARGET CORP (TGT) Stock Fundamental Analysis
NYSE:TGT - New York Stock Exchange, Inc. - US87612E1064 - Common Stock
Taking everything into account, TGT scores 6 out of 10 in our fundamental rating. TGT was compared to 41 industry peers in the Consumer Staples Distribution & Retail industry. TGT has an excellent profitability rating, but there are some minor concerns on its financial health. TGT is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year TGT was profitable.
TGT had a positive operating cash flow in the past year.
TGT had positive earnings in each of the past 5 years.
In the past 5 years TGT always reported a positive cash flow from operatings.
1.2 Ratios
Looking at the Return On Assets, with a value of 7.47%, TGT is in the better half of the industry, outperforming 77.50% of the companies in the same industry.
Looking at the Return On Equity, with a value of 30.16%, TGT belongs to the top of the industry, outperforming 87.50% of the companies in the same industry.
TGT's Return On Invested Capital of 13.03% is amongst the best of the industry. TGT outperforms 87.50% of its industry peers.
The Average Return On Invested Capital over the past 3 years for TGT is significantly above the industry average of 8.38%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.47% | ||
| ROE | 30.16% | ||
| ROIC | 13.03% |
ROA(3y)8.53%
ROA(5y)8.36%
ROE(3y)36.57%
ROE(5y)33.54%
ROIC(3y)14.84%
ROIC(5y)15.04%
1.3 Margins
TGT has a better Profit Margin (4.06%) than 92.50% of its industry peers.
In the last couple of years the Profit Margin of TGT has remained more or less at the same level.
With an excellent Operating Margin value of 5.58%, TGT belongs to the best of the industry, outperforming 92.50% of the companies in the same industry.
TGT's Operating Margin has been stable in the last couple of years.
TGT has a better Gross Margin (28.39%) than 65.00% of its industry peers.
In the last couple of years the Gross Margin of TGT has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 5.58% | ||
| PM (TTM) | 4.06% | ||
| GM | 28.39% |
OM growth 3Y-9.5%
OM growth 5Y-0.61%
PM growth 3Y-6.2%
PM growth 5Y-0.23%
GM growth 3Y-2.17%
GM growth 5Y-1.15%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so TGT is creating value.
TGT has more shares outstanding than it did 1 year ago.
Compared to 5 years ago, TGT has less shares outstanding
TGT has a better debt/assets ratio than last year.
2.2 Solvency
TGT has an Altman-Z score of 3.18. This indicates that TGT is financially healthy and has little risk of bankruptcy at the moment.
The Altman-Z score of TGT (3.18) is worse than 60.00% of its industry peers.
TGT has a debt to FCF ratio of 3.52. This is a good value and a sign of high solvency as TGT would need 3.52 years to pay back of all of its debts.
TGT has a Debt to FCF ratio of 3.52. This is in the better half of the industry: TGT outperforms 70.00% of its industry peers.
TGT has a Debt/Equity ratio of 0.99. This is a neutral value indicating TGT is somewhat dependend on debt financing.
TGT's Debt to Equity ratio of 0.99 is on the low side compared to the rest of the industry. TGT is outperformed by 67.50% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.99 | ||
| Debt/FCF | 3.52 | ||
| Altman-Z | 3.18 |
ROIC/WACC1.63
WACC7.98%
2.3 Liquidity
TGT has a Current Ratio of 0.94. This is a bad value and indicates that TGT is not financially healthy enough and could expect problems in meeting its short term obligations.
Looking at the Current ratio, with a value of 0.94, TGT is doing worse than 67.50% of the companies in the same industry.
TGT has a Quick Ratio of 0.94. This is a bad value and indicates that TGT is not financially healthy enough and could expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 0.25, TGT is doing worse than 77.50% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.94 | ||
| Quick Ratio | 0.25 |
3. Growth
3.1 Past
TGT shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 20.28%, which is quite impressive.
The Earnings Per Share has been growing by 10.54% on average over the past years. This is quite good.
The Revenue has been growing slightly by 0.64% in the past year.
TGT shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 7.35% yearly.
EPS 1Y (TTM)20.28%
EPS 3Y-1.8%
EPS 5Y10.54%
EPS Q2Q%-11.9%
Revenue 1Y (TTM)0.64%
Revenue growth 3Y4.71%
Revenue growth 5Y7.35%
Sales Q2Q%1.06%
3.2 Future
TGT is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 8.12% yearly.
TGT is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 2.76% yearly.
EPS Next Y-2.74%
EPS Next 2Y2.23%
EPS Next 3Y4.73%
EPS Next 5Y8.12%
Revenue Next Year-1.22%
Revenue Next 2Y0.71%
Revenue Next 3Y1.63%
Revenue Next 5Y2.76%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 14.56 indicates a correct valuation of TGT.
Compared to the rest of the industry, the Price/Earnings ratio of TGT indicates a somewhat cheap valuation: TGT is cheaper than 70.00% of the companies listed in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 28.29, TGT is valued a bit cheaper.
A Price/Forward Earnings ratio of 14.72 indicates a correct valuation of TGT.
Based on the Price/Forward Earnings ratio, TGT is valued a bit cheaper than the industry average as 75.00% of the companies are valued more expensively.
Compared to an average S&P500 Price/Forward Earnings ratio of 24.44, TGT is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.56 | ||
| Fwd PE | 14.72 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, TGT is valued a bit cheaper than 65.00% of the companies in the same industry.
TGT's Price/Free Cash Flow ratio is rather cheap when compared to the industry. TGT is cheaper than 87.50% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 13.85 | ||
| EV/EBITDA | 8.24 |
4.3 Compensation for Growth
The excellent profitability rating of TGT may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)1.38
EPS Next 2Y2.23%
EPS Next 3Y4.73%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 3.36%, TGT has a reasonable but not impressive dividend return.
TGT's Dividend Yield is rather good when compared to the industry average which is at 2.47. TGT pays more dividend than 92.50% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.28, TGT pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.36% |
5.2 History
On average, the dividend of TGT grows each year by 11.60%, which is quite nice.
TGT has been paying a dividend for at least 10 years, so it has a reliable track record.
TGT has decreased its dividend recently.
Dividend Growth(5Y)11.6%
Div Incr Years1
Div Non Decr Years1
5.3 Sustainability
46.70% of the earnings are spent on dividend by TGT. This is a bit on the high side, but may be sustainable.
TGT's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP46.7%
EPS Next 2Y2.23%
EPS Next 3Y4.73%
TARGET CORP
NYSE:TGT (1/21/2025, 7:00:00 PM)
After market: 137.29 -0.05 (-0.04%)137.34
+3.73 (+2.79%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupConsumer Staples Distribution & Retail
GICS IndustryConsumer Staples Distribution & Retail
Earnings (Last)
Earnings (Next)
Inst Owners82.98%
Inst Owner Change-0.48%
Ins Owners0.18%
Ins Owner Change3.65%
Market Cap62.93B
Analysts73.02
Price Target146.64 (6.77%)
Short Float %2.69%
Short Ratio1.73
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.36% |
Yearly Dividend4.36
Dividend Growth(5Y)11.6%
DP46.7%
Div Incr Years1
Div Non Decr Years1
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-1.93%
Min EPS beat(2)-20.39%
Max EPS beat(2)16.53%
EPS beat(4)2
Avg EPS beat(4)4.01%
Min EPS beat(4)-20.39%
Max EPS beat(4)22.09%
EPS beat(8)6
Avg EPS beat(8)16.82%
EPS beat(12)7
Avg EPS beat(12)3.46%
EPS beat(16)11
Avg EPS beat(16)7.33%
Revenue beat(2)0
Avg Revenue beat(2)-0.94%
Min Revenue beat(2)-1.86%
Max Revenue beat(2)-0.02%
Revenue beat(4)0
Avg Revenue beat(4)-0.88%
Min Revenue beat(4)-1.86%
Max Revenue beat(4)-0.02%
Revenue beat(8)1
Avg Revenue beat(8)-0.76%
Revenue beat(12)2
Avg Revenue beat(12)-0.66%
Revenue beat(16)5
Avg Revenue beat(16)0.38%
PT rev (1m)0.24%
PT rev (3m)-18.87%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-25.24%
EPS NY rev (1m)0%
EPS NY rev (3m)-9.98%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-2.35%
Revenue NY rev (1m)0.01%
Revenue NY rev (3m)-0.78%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.56 | ||
| Fwd PE | 14.72 | ||
| P/S | 0.59 | ||
| P/FCF | 13.85 | ||
| P/OCF | 8.54 | ||
| P/B | 4.34 | ||
| P/tB | 4.34 | ||
| EV/EBITDA | 8.24 |
EPS(TTM)9.43
EY6.87%
EPS(NY)9.33
Fwd EY6.8%
FCF(TTM)9.92
FCFY7.22%
OCF(TTM)16.08
OCFY11.71%
SpS234.76
BVpS31.62
TBVpS31.62
PEG (NY)N/A
PEG (5Y)1.38
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.47% | ||
| ROE | 30.16% | ||
| ROCE | 16.34% | ||
| ROIC | 13.03% | ||
| ROICexc | 14.37% | ||
| ROICexgc | 14.37% | ||
| OM | 5.58% | ||
| PM (TTM) | 4.06% | ||
| GM | 28.39% | ||
| FCFM | 4.23% |
ROA(3y)8.53%
ROA(5y)8.36%
ROE(3y)36.57%
ROE(5y)33.54%
ROIC(3y)14.84%
ROIC(5y)15.04%
ROICexc(3y)19.57%
ROICexc(5y)22.13%
ROICexgc(3y)20.1%
ROICexgc(5y)22.89%
ROCE(3y)18.62%
ROCE(5y)18.87%
ROICexcg growth 3Y-27.25%
ROICexcg growth 5Y0.99%
ROICexc growth 3Y-26.63%
ROICexc growth 5Y1.17%
OM growth 3Y-9.5%
OM growth 5Y-0.61%
PM growth 3Y-6.2%
PM growth 5Y-0.23%
GM growth 3Y-2.17%
GM growth 5Y-1.15%
F-Score8
Asset Turnover1.84
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.99 | ||
| Debt/FCF | 3.52 | ||
| Debt/EBITDA | 1.6 | ||
| Cap/Depr | 95.86% | ||
| Cap/Sales | 2.62% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 82.33% | ||
| Profit Quality | 104.01% | ||
| Current Ratio | 0.94 | ||
| Quick Ratio | 0.25 | ||
| Altman-Z | 3.18 |
F-Score8
WACC7.98%
ROIC/WACC1.63
Cap/Depr(3y)170.15%
Cap/Depr(5y)146.66%
Cap/Sales(3y)4.29%
Cap/Sales(5y)3.92%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)20.28%
EPS 3Y-1.8%
EPS 5Y10.54%
EPS Q2Q%-11.9%
EPS Next Y-2.74%
EPS Next 2Y2.23%
EPS Next 3Y4.73%
EPS Next 5Y8.12%
Revenue 1Y (TTM)0.64%
Revenue growth 3Y4.71%
Revenue growth 5Y7.35%
Sales Q2Q%1.06%
Revenue Next Year-1.22%
Revenue Next 2Y0.71%
Revenue Next 3Y1.63%
Revenue Next 5Y2.76%
EBIT growth 1Y17.52%
EBIT growth 3Y-5.24%
EBIT growth 5Y6.69%
EBIT Next Year54.95%
EBIT Next 3Y19.34%
EBIT Next 5Y14.56%
FCF growth 1Y351.94%
FCF growth 3Y-21.47%
FCF growth 5Y9.2%
OCF growth 1Y105.78%
OCF growth 3Y-6.44%
OCF growth 5Y7.62%