Despite the "downgrade" of consumption, Goldman raised its target price on TGT before the earnings release.

Goldman released a research report, reiterating its "buy" rating on Target (TGT.US) with a target price of $166. The company is expected to report its fourth-quarter earnings on March 4, with market expectations for revenue of $30.85 billion, down 3% YoY; and EPS of $2.25, down significantly from $2.98 in the same period last year. Goldman expects Target's same-store sales in the fourth quarter to grow 1.5%, in line with the company's guidance, slightly above the market's expectation of 1.2%. It expects discretionary categories may still face challenges, but should see sequential improvement as traffic grows. According to Google Trends data, the search volume for "Target" increased in Q4 2024, but has decreased since Q1 2025. The search volume for the Target app in Q4 2024 was in line with historical data, but the search volume since Q1 2025 is higher than in Q1 2023 and Q1 2024. Target will also hold a conference call on March 4. In addition to focusing on the outlook for 2025 and beyond, Goldman is also paying attention to the latest information on supply chain, inventory, capital expenditure, and alternative revenue. According to a recent report from McKinsey & Company, US consumer spending is generally optimistic, but consumers are not continuing their holiday spending habits into the new year as they did in 2024. A noteworthy trend is that consumers continue to maintain low spending habits and reduce the purchase of semi-discretionary goods (cars, beauty products, toys). This may also affect Target, as it is usually considered a mid-priced retailer rather than the most value-oriented retailer. Target rose 1.42% to close at $124.24 on Friday. The stock has fallen 7% year-to-date.