Target (TGT) Stock Gets ‘Buy’ Rating at Citigroup

Target (TGT) stock was started with a 'buy' rating at Citigroup.
By Amanda Schiavo ,

NEW YORK (TheStreet) -- Target (TGT) - Get Report stock was initiated with a "buy" rating and $88 price target at Citigroup on Monday morning.

The firm began coverage on the retailer based on the company's new areas of focus, The Fly reports. Citigroup believes these areas will yield positive results. Citigroup also finds Target's valuation attractive.

"While the competitive environment is intense for most broadline retailers given the lack of differentiation and price competition, we think TGT is focusing on the right initiatives to further distance themselves from and compete more with Wal-Mart Stores (WMT)," the firm said in a note.

Shares of Target are lower by 1.64% to $75.94 in mid-morning trading on Monday.

Target is a Minneapolis, MN-based retailer offing products ranging from every day essentials, apparel, home décor, groceries, and more.

Separately, TheStreet Ratings team rates TARGET CORP as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:

We rate TARGET CORP (TGT) a BUY. This is driven by several positive factors, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its solid stock price performance, impressive record of earnings per share growth, increase in net income, revenue growth and largely solid financial position with reasonable debt levels by most measures. We feel its strengths outweigh the fact that the company shows low profit margins.

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • Powered by its strong earnings growth of 98.36% and other important driving factors, this stock has surged by 27.86% over the past year, outperforming the rise in the S&P 500 Index during the same period. Turning to the future, naturally, any stock can fall in a major bear market. However, in almost any other environment, the stock should continue to move higher despite the fact that it has already enjoyed nice gains in the past year.
  • TARGET CORP reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past year. We feel that this trend should continue. During the past fiscal year, TARGET CORP increased its bottom line by earning $3.82 versus $3.07 in the prior year. This year, the market expects an improvement in earnings ($4.72 versus $3.82).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Multiline Retail industry. The net income increased by 220.4% when compared to the same quarter one year prior, rising from $235.00 million to $753.00 million.
  • Despite its growing revenue, the company underperformed as compared with the industry average of 7.4%. Since the same quarter one year prior, revenues slightly increased by 2.8%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • The debt-to-equity ratio is somewhat low, currently at 0.91, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels.
  • You can view the full analysis from the report here: TGT

Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of Jim Cramer, TheStreet or any of its contributors.

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