Target Corporation is a company based in the United States. The company operates a chain of 1900 retail stores under the Target brand in all 50 states. In these stores, Target sells essential products like food and personal health goods as well as furniture, various kinds of devices, home goods products, and many others. The company was founded in 1902.
Why You Should?
- The COVID-19 pandemic has boosted Target’s sales as people purchase everything from food and personal health products to furniture and devices. For example, in most markets, people were stockpiling some goods in preparation for the pandemic. This has benefited the company and has also benefited investors in the company.
- Target usually reports some of its best numbers during the holiday season. This holiday season was fairly strong as people either went in-store or went to Target’s e-commerce website to buy gifts and other products. This possible increase in sales will benefit the company and will also benefit investors in the company.
- Target has an extremely resilient business. The company will continue to report stable numbers even through recessions because of the essential nature of the products that are sold in Target stores. This pandemic has truly shown how resilient and stable Target’s business model is. This will help the company go through tough economic times and will also benefit investors in the company.
- Target sells a wide range of products, something that has benefited the company during this pandemic. Stores like Macy’s and TJX have had to shut down stores as they have been classified as non-essential retailers. However, Target stores have remained open as they sell essential products. They also have seen good numbers from their home goods and apparel sector.
- Target has a great e-commerce position. Throughout this pandemic, they have seen massive growth in e-commerce sales growth. Furthermore, customers can pick-up their orders in-store or curbside. This has helped the company adapt their business to best serve their customers during this pandemic. This will also help the company’s long-term growth and will also benefit investors in the company.
- Due to the reasons mentioned above, the company has seen rising revenues and profits over the past couple of years. This has benefited the company’s long-term growth as they were able to invest in their e-commerce capabilities. This has also benefited investors in the company. In the financial year of 2020, the company reported revenues of around 78.1 billion and profits of around 3.28 billion. Both of these metrics are higher than what the company reorted in the financial year of 2019 when they had revenues of around 75.36 billion and profits of around 2.94 billion.
Why You Should Not?
- Target is a great retailer but faces tough competition from many companies. Besides competition from small businesses, the company faces tough competition from Amazon, Costco, Walmart, and many others. This competition might hurt the company in the future and might also hurt investors in the company.
In my opinion, I think that Target is a great long-term investment due to the impacts from the COVID-19 pandemic, the holiday season, a resilient business, a wide range of products, a strong e-commerce position within the industry, and rising revenues and profits. However, tough competition might hurt investors and the company in the future.