lotto results

Thursday, June 1, 2023

[New post] Target Plunges For 10th Day As Boycott Leads To “Traffic Weakness”, JPM Downgrade Adds To Groom And Doom

Site logo image Nwo Report posted: " Posted BY: Zero Hedge | NwoReport As if Target didn't have enough headaches on its plate with a nationwide boycotting campaign targeting the grooming-friendly retailer sending its sales tumbling after it too was Budlighted, one can also add a JPM " Nwo Report

Target Plunges For 10th Day As Boycott Leads To "Traffic Weakness", JPM Downgrade Adds To Groom And Doom

Nwo Report

Jun 1

featured image

Posted BY: Zero Hedge | NwoReport

As if Target didn't have enough headaches on its plate with a nationwide boycotting campaign targeting the grooming-friendly retailer sending its sales tumbling after it too was Budlighted, one can also add a JPM downgrade (from Overweight to Neutral) and price target cut (from $182 to $144) into the mix.

In a note from JPM Chris Hoovers, he explains that he is downgrading TGT to Neutral based on the following:

(1) The consumer is broadly weakening while the share of wallet shifts away from goods (51% of TGT sales) is ongoing.

Trending: Video Examines Methods of Agitators, Provocateurs Who Attacked Police on Jan. 6

(2) Disinflation in grocery (~40% of sales ex beauty and including essentials) continues to accelerate, eating into the ballast of TGT's recent slightly positive to negative LSD SSS trend. TGT comped +HSD in grocery and +LSD in essentials in 1Q, adding 2-3 points to total 1Q SSS vs. the overall flat comp. However, JPM's projection suggests this tailwind could be close to nil by 4Q. Even beauty (estimated at ~10% of sales) is slowing on a 1Y basis per Nielsen .

(3) While still positive on a 3Y basis, TGT has been giving back shares on a 1Y view and this share loss could accelerate into back to school and linger into holiday given consumer pressures and what JPM tactfully calls "recent company controversies." This, the bank says, could turn TGT's traffic negative after an impressive run of 12 consecutive positive quarters. This shift is "generally bad for retail stock valuation given attribution is highest at the topline and, particularly for traffic."

(4) JPM notes that TGT over-indexes to the millennial customer and, should student loan payments come back on - which they are about to, as we discussed recently -  the company is more exposed than others in JPM's coverage. Buyside client expectations are in the $6-8MM per month consumer outflow range should this happen, which represents a potential 1-2 point comp headwind to retail spending which is material given the baseline comp discussed above.

(5) Google search surges in states representing ~37% of its stores with the biggest uptick in the south central and south Atlantic (guess what people are searching). JPM examined Google Trends data to see which states have seen the greatest increase in relative search frequency for  ̆Target Corporation ̇ over the last week (5/24/23 - 5/31/23) vs. the period from (5/25/22 -4/30/23). Using 8 as the mendoza line to measure the potential for a negative reaction, the states where search surged represent ~37% of its store base.

(6) Finally, TGT share gains have been reverting. As seen below,  TGT has been giving back share as other retailers opened and the consumer got back into stores and started dressing up for events. Despite 1Y headwinds, the trend has remained positive on a 3Y basis but this could be at increased risk given the above.

Meanwhile, as Wells Fargo also opines this morning, the controversy around Target's collection of LGBTQ-themed merchandise for Pride Month "adds uncertainty to a stock that already had earnings risk amid a pullback in discretionary spending."

Most importantly Wells analyst Edward Kelly writes that "there is early evidence of some financial impact, with Placer.ai data signaling incremental traffic weakness in the week ended May 28"

"Traffic has been a key bright spot for TGT as it struggled with margin issues, and a slowdown would be negative", obviously.

As a result, TGT stock is down for a 10th session in its longest losing streak since February 2000, and together with Tranheuser Bush should serve as a great lesson for any other corporations who seek to alienate the bulk of consumers (especially those who don't live on government handouts) just to cater to a very mentally unstable 0.5% of the population.

Comment

Unsubscribe to no longer receive posts from Nwo Report.
Change your email settings at manage subscriptions.

Trouble clicking? Copy and paste this URL into your browser:
https://nworeport.me/target-plunges-for-10th-day-as-boycott-leads-to-traffic-weakness-jpm-downgrade-adds-to-groom-and-doom/

WordPress.com and Jetpack Logos

Get the Jetpack app to use Reader anywhere, anytime

Follow your favorite sites, save posts to read later, and get real-time notifications for likes and comments.

Download Jetpack on Google Play Download Jetpack from the App Store
WordPress.com on Twitter WordPress.com on Facebook WordPress.com on Instagram WordPress.com on YouTube
WordPress.com Logo and Wordmark title=

Learn how to build your website with our video tutorials on YouTube.


Automattic, Inc. - 60 29th St. #343, San Francisco, CA 94110  

at June 01, 2023
Email ThisBlogThis!Share to XShare to FacebookShare to Pinterest

No comments:

Post a Comment

Newer Post Older Post Home
Subscribe to: Post Comments (Atom)

Timber Market Analysis Class

Registration Now Open     Registration is Open for Forisk's Timber Market Analysis Class! ...

  • [New post] Tony Bennett Ft. Lady Gaga – You’re The Top
    Ayonline posted: " American singer, Tony Bennett come through with a new song title You're The Top Feat. Lady Gaga ...
  • [New post] The Z Blog: Money Matters
    sengssk posted: "A favorite expression is "pressure reveals character." Anyone who has played sports has probably...
  • [New post] Today’s Journey Tarot Card of the Day 9-29-22
    Today...

Search This Blog

  • Home

About Me

lotto result
View my complete profile

Report Abuse

Blog Archive

  • July 2025 (2)
  • June 2025 (3)
  • May 2025 (2)
  • March 2025 (5)
  • February 2025 (3)
  • January 2025 (4)
  • December 2024 (2)
  • November 2024 (1)
  • October 2024 (3)
  • September 2024 (4)
  • June 2023 (176)
  • May 2023 (1209)
  • April 2023 (1076)
  • March 2023 (1208)
  • February 2023 (912)
  • January 2023 (998)
  • December 2022 (1022)
  • November 2022 (1082)
  • October 2022 (1580)
  • September 2022 (1476)
  • August 2022 (1694)
  • July 2022 (1786)
  • June 2022 (1251)
  • May 2022 (1056)
  • April 2022 (1443)
  • March 2022 (1328)
  • February 2022 (1092)
  • January 2022 (1332)
  • December 2021 (1657)
  • November 2021 (3162)
  • October 2021 (3225)
  • September 2021 (3171)
  • August 2021 (3282)
  • July 2021 (1390)
Powered by Blogger.