Target store in Novato, California was the place to be on March 5, 2025, as shoppers flocked to the Minneapolis-based retailer for some cheap chic finds. With the fiscal first-quarter earnings report looming, Wall Street is eagerly waiting to see if Target can bounce back from its recent struggles. Analysts surveyed by LSEG have some expectations for the retailer, so let’s dive into what they’re predicting.
According to the survey, analysts are anticipating earnings per share of $1.64 and revenue of $24.32 billion for Target. As the earnings report approaches, investors are keeping a close eye on how the retailer will fare compared to other big-box stores like Walmart and Home Depot. Both competitors recently shared their quarterly updates, with Walmart and Home Depot reaffirming their full-year outlooks. But when it comes to dealing with higher costs from tariffs, the two companies have taken different approaches. Walmart plans to raise prices for customers due to the duties, while Home Depot has no such intentions. It seems like each retailer is tackling the tariff issue in its unique way.
For Target, tariffs are just one piece of the puzzle. The retailer has been experiencing flat annual revenue for the past four years, with sales dipping in key categories like home decor. Consumers are being more selective with their spending habits, leading to weaker sales in discretionary areas. Additionally, Target has faced criticism from shoppers and pressure from activists like the Rev. Al Sharpton for scaling back on diversity, equity, and inclusion initiatives. In February, Target already warned of profit pressure in the first quarter due to softer sales and uncertainties around consumer sentiment and tariffs. Looking ahead, the retailer has set modest expectations for the fiscal year, projecting minimal growth in net sales and flat comparable sales. Adjusted earnings per share are expected to fall between $8.80 and $9.80, with a slight increase in the operating margin rate compared to the previous year. It seems like Target is bracing itself for a challenging year ahead.
