5 Stocks Getting Crushed by Global Supply Chain Crisis

3. Target Corporation (NYSE:TGT)

Number of Hedge Fund Holders: 50

Year-to-Date Share Price Decline as of June 1: 32.52%

Target Corporation (NYSE:TGT) is a general merchandise retailer in the United States. On May 18, the company reported its Q1 financial results. The earnings per share of $2.19 missed analysts’ consensus estimates by $0.87. Target Corporation (NYSE:TGT) shares have declined about 32.5% YTD as of June 1. 

On May 19, JPMorgan analyst Christopher Horvers slashed the price target on Target Corporation (NYSE:TGT) to $188 from $302 and maintained an Overweight rating on the shares. The analyst is “not throwing in the towel” after the earnings miss. The issues that resulted in Target Corporation (NYSE:TGT)’s “substantial miss and nearly unimaginable guide down” primarily relate to poor inventory and supply chain execution, the analyst told investors. Until inventory “cleans up”, Target Corporation (NYSE:TGT) will suffer from valuation headwinds as is generally the case with retailers and sell-downs on big estimate cuts, added the analyst.

According to Insider Monkey’s database, 50 hedge funds were bullish on Target Corporation (NYSE:TGT) at the end of Q1 2022, compared to 49 funds in the preceding quarter. Arrowstreet Capital held the largest stake in the company, comprising 2.50 million shares worth $530.5 million. 

Here is what Nelson Capital Management has to say about Target Corporation (NYSE:TGT) in its Q2 2021 investor letter:

“We added Target (tkr: TGT) to our consumer staples sector. Target Corporation (NYSE:TGT) offers a broad array of products in owned and known brand items at affordable prices. Its omni-channel fulfillment centers allow customers to receive their items via in-store pickup, curbside pickup, same-day shipping and regular shipping while simultaneously reducing operating costs. With a significantly lower valuation than peers and a unique operating strategy, Target is an attractive holding.”