The Minneapolis-based company said the share repurchasing program is expected to be completed in 2020.
The board also declared a quarterly dividend of 66 cents a share, which will be payable Dec. 10, to shareholders of record on Nov. 20. The fourth-quarter dividend will be Target's 209th consecutive dividend paid since October 1967 when the company went public.
Last month, Target reported second-quarter net income of $938 million, or $1.82 a share, vs. $799 million, or $1.47 a share, in the comparable year-ago quarter. Analysts polled by FactSet had been expecting earnings of $1.62 share.
Sales came in at $18.4 billion, vs. $17.8 billion a year ago and above Wall Street estimates of $18.3 billion. Same-store sales rose 3.4%, above the 3% pace expected by analysts. Comparable digital sales grew 34%, contributing 1.8 percentage points to comparable sales growth, the company said.