Target Corp.: How Durable is the Improvement; Piecing Together the Q1 Acceleration

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Target Corp.: How Durable is the Improvement; Piecing Together the Q1 Acceleration

Equity Research

U.S. Broadlines, Hardlines & Food Retail

11 May 2026

Target Corp.

How Durable is the Improvement;

Piecing Together the Q1

TGT UNDERWEIGHTAcceleration

Unchanged

We dissect the drivers of the improvement in sales that has U.S. Broadlines, Hardlines & NEUTRAL Food Retail

Unchangedsupported the stock's move since Feb. There are some

encouraging signals but not all can be extrapolated. We see Price Target USD 115.00 raised 6% from USD 108.00

TGT getting back to the baseline after sales/margin reset in Price (04-May-26) USD 127.76

Potential Upside/Downside -10.0%2025 but continue to debate the growth path.

Source: Bloomberg, Barclays Research

Key message: We believe that sales have improved meaningfully in Q1 vs. recent quarters, with

Market Cap (USD mn) 58025

comps running at times +MSD/HSD, settling in the 3-4% range (vs. -2.5% in Q4, and our prior

Shares Outstanding (mn) 454.18

+0.6% and consensus +1.4%). We dissect some of the drivers in this note. The improvement has

Free Float (%) 99.67

come faster than we expected, reflecting some initial positive change at TGT, but also very easy

52 Wk Avg Daily Volume (mn) 6.9

comparisons, and broader strength in the market, tying in with incremental tax refunds.

Dividend Yield (%) 3.64

Meanwhile, our reads on market share and different customer cohort trends are more mixed. As

Return on Equity TTM (%) 24.04

such, while we appreciate that there is more newness and change on the way, we would not

Current BVPS (USD) 35.70

extrapolate all of this Q1 strength. Q2 in particular has more difficult comparisons in select Source: Bloomberg

categories. Our model assumes Q1 comps are the best of the year. Overall, our key take is that we