Wells Fargo Analysts Downgrades Target Stock
2023.01.04 09:22
Wells Fargo Analysts Downgrades Target Stock
Budrigannews.com – After Wells Fargo analysts downgraded to Equal Weight from Overweight, Target (NYSE) stock moved nearly 2% lower in the pre-market on Wednesday.
Target’s outlook “has deteriorated meaningfully,” according to the analysts, and as a result, the stock no longer represents “an attractive investment into an uncertain 2023.” All the more exactly, they feature 4 key worries:
1) The likelihood of a prolonged period of comp weakness in general merchandise; 2) An inflection to negative traffic in Q4; 3) A lack of visibility regarding the timing and magnitude of the margin recovery story; and 4) The reemergence of concerns regarding the scalability of the model prior to COVID.
Despite low expectations, Wells Fargo sees little upside in Target stock overall. The price target has been lowered from $170 per share to $142, indicating a risk of more than 6% below yesterday’s closing price.
“As we begin 2023, we see a complicated and rather uninspiring investment backdrop for our [retail] group. While protection ought to stay stylish given the unsure purchaser setting, the essentials of our staples names don’t look especially convincing,” the examiners wrote in a note.
Performance Food Group (NYSE:), one of Wells Fargo’s top retail picks, General Dynamics (NYSE:), NYSE: BJ’s Wholesale Club, NYSE: Walmart, as well as Casey’s General Stores, NASDAQ:
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