10 Cheap Retail Stocks to Buy According to Analysts

6. Target Corporation (NYSE:TGT)

Forward P/E: 16.34

Analyst Upside Potential as of September 23, 2024: 15.12%

Number of Hedge Fund Holders as of Q2 2024: 52

Target (NYSE:TGT) is a retail giant with over 2,000 discount department stores and hypermarkets across the US and Canada. It serves its customers, referred to as guests, an array of items, including everyday essentials, fashionables, differentiated merchandise at discounted prices, and an array of general merchandise and food. Its merchandise categories span apparel and accessories, food and beverages, home furnishing and decor, and others. Target’s (NYSE:TGT) digital channels also include an elaborate assortment of merchandise and food, including the items sold in its stores and a complementary assortment sold by third parties and the company itself. Its brand portfolio includes Cloud Island, Ava & Viv, A New Day, Favorite Day, and others.

Target (NYSE:TGT) is not just returning to growth but is also exceeding analyst expectations with its operations. Comparable sales in Q2 2024 increased by 2%, driven entirely by traffic. This shows that the company’s multiple guest-focused initiatives are working. Its store and digital channels also saw growth in Q2, further solidifying the company’s presence in the market. Target (NYSE:TGT) already holds a competitive market edge due to its reputation as a retailer.  With traffic growth in all six merchandising categories of the Company, customers seem to be coming back to Target (NYSE:TGT). Sales in apparel, one of its key categories, rose by 3%. Its discretionary categories comprise a significant portion of its revenue and are also improving.

As of Q2 2024, Target (NYSE:TGT) is held by 52 hedge funds as of Q2 2024, with Diamond Hill Capital holding the highest stake worth $458.13 million.

Carillon Eagle Growth & Income Fund stated the following regarding Target Corporation (NYSE:TGT) in its Q2 2024 investor letter:

“Target Corporation’s (NYSE:TGT) sales continue to feel the consumer softness in discretionary goods. In addition, while margins are recovering, they are not up to expectations. Encouragingly, sales are sequentially increasing, and comparable sales are expected to get easier as Target enters the back half of the year.”