Target Corporation, commonly known as Target, is a major American retail corporation founded in 1902. Headquartered in Minneapolis, Minnesota, Target operates a vast network of stores across the United States, offering a diverse range of products including clothing, electronics, groceries, and household goods. Known for its distinctive red logo and design-centric approach, Target has positioned itself as a favorite shopping destination for many consumers seeking quality and affordability. The company is committed to innovation, sustainability, and community engagement, continuously adapting to the changing retail landscape to provide an exceptional shopping experience for its customers.
Target Fiscal Q4 2024
Target (TGT) full-year 2024 net sales dropped by 0.8%, and both GAAP and adjusted EPS fell by 0.9%, compared to the longer 2023 fiscal year.
Adjusting for the extra week in 2023, net sales rose about 1%, and EPS was almost 3% higher.
The company paid $513 million in dividends and repurchased $506 million of shares. After-tax return on invested capital was 15.4%, down from 16.1% due to lower profitability and higher invested capital.
Q4 2024 Highlights:
- Comparable sales grew 1.5%, with strong traffic and digital sales.
- Digital sales increased by 8.7%.
- GAAP and adjusted EPS were $2.41, near the top of the guidance range.
Full-Year 2024 Highlights:
- Comparable sales increased by 0.1%.
- GAAP and adjusted EPS were $8.86.
- Traffic grew by 1.4%.
- Efficiency efforts saved over $2 billion in the past two years.
Top-performing categories included Toys, Electronics, and Apparel, with significant growth in digital and same-day delivery services.
Outlook
For 2025, the company expects:
- Net sales growth around 1%
- Flat comparable sales
- A slight increase in operating margin
- An effective tax rate of 23-24%
- GAAP and adjusted EPS between $8.80 and $9.80
Due to ongoing consumer uncertainty, a small decline in February sales, tariff uncertainty, and the timing of costs, the company anticipates significant profit pressure in Q1 compared to the rest of the year.
Board Statements
Brian Cornell, CEO of Target, highlighted their strong Q4 performance, especially in Beauty, Apparel, Entertainment, Sporting Goods, and Toys. He emphasized their ongoing investments in digital capabilities, stores, and supply chain to enhance the shopping experience and drive long-term growth.
CFO Jim Lee mentioned record performance around Valentine’s Day but noted that overall February sales were soft due to cold weather and declining consumer confidence. They expect improved apparel sales with warmer weather and upcoming seasonal events like Easter. The company remains cautious with its expectations for the year ahead.
Impact on the Stock Market
Target’s stock (TGT) dropped about 4% after the earnings report was released. This fall was likely because the company gave cautious guidance for the first quarter of 2025 and mentioned ongoing consumer uncertainty and weak sales in February. Also, concerns about tariffs and inflation affecting how much people spend contributed to the stock’s drop.
