Target Corporation (TGT) May Be Down, But It’s Far From Out

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Target Corporation (NYSE:TGT) has had a tough year. In fact, TGT is down 16% within the last six months. But this isn’t time to sell Target stock. This is time to buy.

Target Stock (TGT) May Be Down, But It's Far From Out

With some stocks, a big loss that makes them relative underperformers is a signal that it’s time to step out and reevaluate your position.

However, in this case, TGT is still a powerful retail force with a very attractive — and strong — dividend, great valuations and safety that will be to its advantage as volatility heats up again.

Also, if the Federal Reserve decides to raise rates, there will be a flight to safety and one of the prime beneficiaries will be a discount retailer like Target stock.

The Foundation of TGT’s Strength

TGT is well ahead of schedule on its goal to save $2 billion in operating costs over the next two years. It is expanding its Signature Series brands in the food section and making an aggressive effort to expand its organic offerings. It also has a very solid stock buyback program, which has helped keep its dividend strong and growing.

This is the 46th consecutive year that Target has raised its dividend. It is an official Dividend Aristocrat that has continued to grow its dividend 20% annually for the last decade.

These are the facts that prove why TGT, after its tough 2016, is a bargain here, not a sell. If you’re an income investor, or someone simply looking for some long-term, safe total return, look no further than TGT.

Also, don’t forget that TGT was originally founded in 1902. It’s over a century old and that tells you that the company has a long, successful history through two World Wars, the Great Depression and many other significant events and has continued to grow. This ‘long view’ is precisely the kind of stock you want as the markets become increasingly turbulent.

It will certainly have competition from contemporaries Wal-Mart Stores, Inc. (NYSE:WMT) and Amazon.com, Inc. (NASDAQ:AMZN), but it has seen plenty of competitors come and go over the decades.

The fact is, TGT has a long history of not simply enduring, but succeeding. And given its age, it remains very nimble for such a big company and is very technology friendly. It’s No. 22 on the Internet Retailer 2016 Top 500 Guide.

Beyond that, its e-commerce business is proving to be a significant growth engine. Its Cartwheel app, which alerts customers to quick-hit deals and special offers, has more than 25 million downloads. As of March 2015, it had already added $1 billion in sales revenue.

This is no time to walk away from TGT; it’s time to start picking it up for the long haul.

Richard Band’s Profitable Investing advisory service helps retirement savers outperform the market without losing a minute of sleep along the way. His straightforward style and low-risk value approach has won seven Best Financial Advisory awards from the Newsletter and Electronic Publishers Foundation.

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Article printed from InvestorPlace Media, https://investorplace.com/2016/09/target-stock-tgt-down-far-from-out/.

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