We recently published a list of 10 Oversold Stocks to Buy in 2025 Amid Inflation Fears. In this article, we are going to take a look at where Target Corporation (NYSE:TGT) stands against other oversold stocks to buy in 2025 amid inflation fears.
The stock market continues to face significant volatility, with major indices continuing their decline from last week. The S&P 500 is down nearly 2%, while the Nasdaq is equally struggling at over 2.5% in the red.
The implementation of new tariffs had already spooked the market. However, it was dealt an additional blow as the core Personal Consumption Expenditures index reading came in hotter than expected. Inflation and recession concerns are dominating the market, but this also presents an opportunity for outperformance.
Stocks that are oversold as a result of the current dip present a great opportunity for outperformance in 2025. We decided to come up with a list of such stocks.
To ensure that these stocks were suitable for a bear market, were it to persist, we also added an additional criterion of a strong dividend yield so that investors can accumulate dividends while they wait for a market turnaround. For this list, we only considered stocks with a market cap of at least $2 billion that are down considerably since the start of the year.
A woman purchasing groceries at a Target store, with a cart full of products.
Target Corporation (NYSE:TGT)
Target Corporation (NYSE:TGT) is a general merchandise retailer. It offers shoes, apparel for women, men; and babies, accessories, beauty products, and jewelry. The company also provides food and beverage products, dry and perishable groceries, electronics, and luggage. The stock is following a downward trend, losing 23% this year.
Target Corporation (NYSE:TGT)’s Relative Strength Index (RSI) is hovering around the 30 mark, making it one of the most oversold S&P 500 stocks despite its fundamental strength. The stock has struggled due to poor earnings resulting from a tough retail environment as well as competition from giants like Walmart and Amazon. This pessimism has brought the stock down to levels seen during the pandemic in 2020.
There is reason to believe that a reversal is around the corner. First, Target Corporation (NYSE:TGT) already guided lower after a poor Q3 so it’s unlikely that it misses the earnings again. Second, the valuation is already extremely cheap, trading at 11 times 2027 earnings, compared to 30 for Walmart and 47 for Costco. This is the ideal time to start accumulating the stock as a long-term play.
Overall, TGT ranks 9th on our list of oversold stocks to buy in 2025 amid inflation fears. While we acknowledge the potential of TGT as a leading investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is as promising as TGT but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.
Disclosure: None. This article is originally published at Insider Monkey.
