Target (TGT) Looks to Turn Around Its Stock in 2012
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2011 is a year Target (NYSE: TGT) investors would like to forget.
With Target shares ending 2010 at $58.86, the retailing giant is down 14 percent so far this year, or 12 percent adjusted for dividends. Meanwhile rival Wal-Mart (NYSE: WMT) has seen its stock rise 14 percent.
This year's downswing in Target started early. In January, disappointing December '10 sales put shares in a tailspin - something it didn't get out of until about mid-year. Since that time shares have been improving modestly.
In its latest quarter, Target showed a 28 percent rise in pro-forma earnings which was bolstered by the company's REDcard imitative. The Target REDcard gives shoppers a automatic 5 percent off purchases at the store or online, and free shipping, among other things. The company hopes to continue this momentum in 2012.
With December sales data due in early January and earnings due mid-February, Target hopes to start off the new year on a better foot. The fate of Target shares will also depend on overall macro conditions. If the economy improves, Target could start winning back some of the shoppers they may have lost to Wal-Mart and the dollar stores.
Overall, Target looks like a good bet for 2012 and the 2.3 percent dividend yield provides solid support for the stock.
Shares are about 0.6 percent lower Wednesday, on overall light volume.
With Target shares ending 2010 at $58.86, the retailing giant is down 14 percent so far this year, or 12 percent adjusted for dividends. Meanwhile rival Wal-Mart (NYSE: WMT) has seen its stock rise 14 percent.
This year's downswing in Target started early. In January, disappointing December '10 sales put shares in a tailspin - something it didn't get out of until about mid-year. Since that time shares have been improving modestly.
In its latest quarter, Target showed a 28 percent rise in pro-forma earnings which was bolstered by the company's REDcard imitative. The Target REDcard gives shoppers a automatic 5 percent off purchases at the store or online, and free shipping, among other things. The company hopes to continue this momentum in 2012.
With December sales data due in early January and earnings due mid-February, Target hopes to start off the new year on a better foot. The fate of Target shares will also depend on overall macro conditions. If the economy improves, Target could start winning back some of the shoppers they may have lost to Wal-Mart and the dollar stores.
Overall, Target looks like a good bet for 2012 and the 2.3 percent dividend yield provides solid support for the stock.
Shares are about 0.6 percent lower Wednesday, on overall light volume.
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