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So, I am a novice at stocks, but think Target is a good stock. I was looking to get feedback for and against.
Why I think Target is a good pick for stocks right now.
(1) Target stock fell about 50% from its high when profits were down just recently. So it is at a "low" point.
(2) Target's P/E ratio is 11.75, my father in law says 15 and below is "good." P/E ratio is the price of a stock divided by the earnings per stock. This means it might be "over sold" meaning that people sold it too much when their profits shrank.
(3) Look at a rival of Target's P/E ratio, Walmart's P/E is 26.41. This suggests that Target might have more upward mobility than Walmart with their price of their stock.
(4) Target has a great reputation amongst my friends. The stores are always clean, bright, quick, helpful, and paired with things like Starbucks, CVS, and Pizza Hut.
(5) Target has a nice debit card with 5% off discounts, which makes for loyal customers.
(6) Target pays a 3.07% dividend, which is extra cash.
Why I might be wrong.
(1) Target's food section is lacking compared to a Walmart and certainly a Meijer.
(2) A recession or inflation could further hurt profits.
What are your thoughts? I need to be my husband over the course of a year.
Target had a big miss but confirmed they thought the rest of the year should be good. I’m not sure what data point they are looking at but there’s no way for them the know what the US consumer is going to do the rest of the year.
Target and Walmart really aren’t comparable imo, same general area but Walmart’s online presence, grocery delivery and other avenues such as just being the bully in the space separates the two
Target’s dividend isn’t “Extra cash” so that tells me you don’t understand how this works at all
You can also purchase a retail ETF, which is in the category of "consumer discretionary." A retail ETF will have holdings of many retailers in the fund, depending on the fund. That gives you more exposure to the sector.
Target's ok, if owning just the one retailer is your desire.
WMT...best in class...everyone else is just playing along until they die just like KMART, JCP, AMES, and all of the other regional favorites that no longer exist.
Brick and Mortar retail is dying because i can sit in my home and buy anything in the world i wish to purchase and have it on my doorstep tomorrow morning. Maybe there are a few die-hards left who can still stand to go into a store, but do they really buy, or is it just the warmth they get from being in the store waiting for the price of that coat they really like to hit rock bottom?
WMT...best in class...everyone else is just playing along until they die just like KMART, JCP, AMES, and all of the other regional favorites that no longer exist.
Brick and Mortar retail is dying because i can sit in my home and buy anything in the world i wish to purchase and have it on my doorstep tomorrow morning. Maybe there are a few die-hards left who can still stand to go into a store, but do they really buy, or is it just the warmth they get from being in the store waiting for the price of that coat they really like to hit rock bottom?
That's ridiculous, there are plenty of brick and mortar retailers doing just fine...WMT, COST, HD, LOW, TJX, ROSS just to name a few.
Target never excited me though, I can buy mostly the same things at WMT for a better price so I just suck it up and go to WMT. The stores may not be as nice as TGT, but so what? That said, TGT looks like a solid long term buy right now. Short term they could go lower, so be prepared to average down as you build your position, and be prepared to hold for a while (3-5 years if need be) waiting for it to get to new highs. If you can do that, you should do quite well long term.
Over the trailing 5 years, Target's shares have outperformed both Wal-Mart and Amazon. I've owned it for longer than that. It's been a good investment, although not a 10-bagger or 20-bagger (in Peter Lynch terms).
I have to disagree with the notion that all shopping will eventually go online. I personally have my doubts about that model being the most efficient. Each item gets another layer of packaging, either a box or a plastic wrapper. Then every little item gets hand delivered to the customer's door.
Target's curbside pickup is very convenient if you allow them to see the location tracking on your phone. They know you are coming already. No calling or texting, they are often outside with the order already when we park. No worries about porch pirates. No confusion with packages being delivered to the wrong address (yes, it happens to us).
That's ridiculous, there are plenty of brick and mortar retailers doing just fine...WMT, COST, HD, LOW, TJX, ROSS just to name a few.
Target never excited me though, I can buy mostly the same things at WMT for a better price so I just suck it up and go to WMT. The stores may not be as nice as TGT, but so what? That said, TGT looks like a solid long term buy right now. Short term they could go lower, so be prepared to average down as you build your position, and be prepared to hold for a while (3-5 years if need be) waiting for it to get to new highs. If you can do that, you should do quite well long term.
Wal-Marts not being as nice or 'hip' as Target is actually a rather big deal. The 'typical' shopper at both has an income of $80k and (somewhat surprisingly) are both female, white, married and a couple other similarities, but the typical WMT shopper is 59.5 years old while the typical TGT shopper is 39. That gives me a cause for concern in the long-term.
I've stopped shopping at Wal-Mart altogether. Never did go there much, but now it's my last resort. Sure, the prices are cheap, but so is a lot of the merchandise.
The last straw for me was a pair of shoes I bought at Wal-Mart. I just happened to see the price when I was in the store, and figured why not save some money (compared to the prices I'd been paying)? Within a month my feet were in excruciating pain. Eventually I narrowed down the cause to the shoes. On a per-mile basis those were the most expensive shoes I've ever purchased.
So, I am a novice at stocks, but think Target is a good stock. I was looking to get feedback for and against.
What are your thoughts? I need to be my husband over the course of a year.
I like to have the "best of breed" so to speak. What I mean by that is I own AMD and Nvidia. I own Apple, Google, and Microsoft. My recommendation is to consider investing equally in Amazon, Target, and Walmart. Or at least pick one other with Target, so that you have two strong retail players.
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