‘Don't Buy Yet,' Say Top Analysts after Downgrading Target Stock (TGT)
Target (TGT) has been hit with rating downgrades from several Top-rated analysts, citing concerns over weak sales, margin pressures, and macro uncertainty. The rating cuts came after TGT's lower-than-expected first quarter results, released earlier this week. Also, declining sales and margin pressures resulted in a lower full-year outlook.
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The company's key challenges include higher markdowns and digital fulfillment costs, which hurt profitability. Also, changes to its diversity, equity, and inclusion (DEI) policies have led to consumer backlash and boycotts.
Analysts Downgrade Ratings amid Sales Struggles
BofA Securities analyst Robert Ohmes downgraded Target stock to Hold from Buy, slashing the price target to $105 from $145. The five-star analyst sees ongoing sales struggles, leading to higher markdowns and margin pressures, making a recovery uncertain. Despite Target's stock trading near 10-year lows, Ohmes believes the uncertainty outweighs the valuation appeal, prompting the downgrade.
At the same time, Telsey Advisory analyst Joseph Feldman also cut Target's rating to Hold from Buy, with a price target cut from $130 to $110. Feldman cited a challenging macro environment, inconsistent execution, and tariff-related risks as key concerns. The Top analyst also noted that his confidence was shaken by weak Q1 2025 results, along with lowered guidance for 2025.
Another analyst, Melius from Karen Short, downgraded Target to Hold from Buy.
Is Target a Buy or Sell?
Turning to Wall Street, TGT stock has a Hold consensus rating based on 10 Buys, 21 Holds, and two Sells assigned in the last three months. At $105.46, the average Target stock price target implies a 10.94% upside potential.
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