Target (TGT) could be best be described as a more upscale Wal-Mart (WMT). Unfortunately, in times like these, it pays just to be regular old Wal-Mart.
This past year, TGT has seen its stock price fall by a third, while WMT is up a third. Today, Bank of America added insult to injury and cut its target on TGT to keep pace with the stock’s drop. The bank also added these negative sentiments:
- traffic at TGT continues to be weak
- there will be no recovery for TGT until there is a sustained sales re-acceleration
The only ways we see a “sustained sale re-acceleration” happening are from an economic recovery or another tax-rebate steroid shot. The first isn’t likely to happen anytime soon and the second is still uncertain and may not fit the bill of being “sustained.”
Bank of America maintains NEUTRAL on Target (TGT), target cut from $56 to $49.
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