Target (TGT) Stock Up After BMO Capital Increases Price Target

NEW YORK (TheStreet) -- Shares of Target Corp. (TGT) are higher by 0.05% to $79.43 after BMO Capital Markets increased its price target to $85 from $82 and maintained its "market outperform" rating for the Minneapolis-based retail company.

Target released its first quarter earnings on May 20, with net income rising 51.6% to $635 million, or $1.10 per share, beating BMO Capital Markets' estimate of $1.04 per share.

The retailer reported revenue of $17.12 billion, compared to revenue of $17.05 billion during the same period a year ago.

"Earnings were driven by comp-store sales growth of 2.3%, which importantly comprised sequential growth in both transaction +0.9% and ticket +1.4%, with Signature categories driving outsized comps (Beauty +5%, Apparel and Home +4%) on a one- and two-year basis-implying growth was not just on an easy comparison," said BMO analyst Wayne Hood. "As expected, mid-single-digit declines in electronics continue to be a drag on results as it is with other retailers."
Two consecutive quarters of traffic growth and markedly strong contribution from key Signature categories, along with Target's ability to execute across channels as digital sales continued to grow sharply, at 38%, strengthened BMO's confidence in the efficacy of management's merchandise category segmentation strategy, according to BMO Capital Markets.

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:

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