NEW YORK (TheStreet) -- Shares of Target Corp. (TGT) - Get Target Corporation Report are lower by 1% to $73.89 in late morning trading on Friday, as a U.S. District judge in St. Paul, MN, ruled that consumers can sue the retail giant over a 2013 data breach, that complainants say made their financial information vulnerable, Reuters reports.
The judge dismissed the claims of plaintiffs in some states, but for the most part denied Target's request to throw out the proposed class action lawsuit, Reuters added.
The judge rejected Target's assertion that the consumers did not have the right to sue since they could not prove any injury.
During the breach Target said at least 40 million credit cards had been compromised, Reuters noted.
"Plaintiffs' allegations plausibly allege that they suffered injuries that are 'fairly traceable' to Target's conduct," the judge said in his ruling, according to Reuters.
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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 revenue growth, largely solid financial position with reasonable debt levels by most measures, solid stock price performance, increase in net income and growth in earnings per share. We feel these strengths outweigh the fact that the company shows low profit margins."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- TGT's revenue growth has slightly outpaced the industry average of 3.6%. Since the same quarter one year prior, revenues slightly increased by 2.7%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- The debt-to-equity ratio is somewhat low, currently at 0.87, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels.
- The stock has risen over the past year as investors have generally rewarded the company for its earnings growth and other positive factors like the ones we have cited in this report. Looking ahead, the stock's rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry. We feel, however, that the other strengths this company displays justify these higher price levels.
- The net income growth from the same quarter one year ago has exceeded that of the Multiline Retail industry average, but is less than that of the S&P 500. The net income increased by 2.9% when compared to the same quarter one year prior, going from $341.00 million to $351.00 million.
- TARGET CORP's earnings per share improvement from the most recent quarter was slightly positive. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, TARGET CORP reported lower earnings of $3.07 versus $4.53 in the prior year. This year, the market expects an improvement in earnings ($3.25 versus $3.07).
- You can view the full analysis from the report here: TGT Ratings Report