We recently published a list of Was Jim Cramer Right About These 11 Stocks? In this article, we are going to take a look at where Target Corporation (NYSE:TGT) stands against other stocks that Jim Cramer discusses.
In an older segment, Jim Cramer revisited Target Corporation (NYSE:TGT) following its earnings, where the company posted inline results that disappointed the market. Cramer acknowledged Target’s strong retail legacy, but noted that it had lost momentum relative to its peers:
“Target always gave us better same-store sales growth and more exciting stories of consumer enthusiasm. Now though, you know what? The shoe is actually on the other foot. Walmart’s crushing it with much better-than-expected store numbers while Target’s putting up largely inline results — which is not enough to do the job. […]
Don’t get me wrong, Target is a terrific company. It didn’t miss its numbers — it’s fun to shop at. But in the end it’s become a meaningful domestic enterprise while Walmart’s become an international colossus. I actually think Target’s setting itself up for a good second half and its stock might be a buy if it settles down.”
A woman purchasing groceries at a Target store, with a cart full of products.
Cramer was wrong here as Target fell 34.71% over the year. The discount retailer Target Corporation (NYSE:TGT) is working to stabilize its margins and drive traffic through aggressive price cuts and expanded private label offerings.
Following the retailer’s latest earnings report, on the 21st of May, Cramer shared his thoughts on the stock and what the way forward for Target is:
“Right but Brian was very upset. Wanted to do much better. Recognizes that frankly that his prices might be too high. Has to discount more. . .look, let’s just call it. It was a bad quarter. Now I know when I pressed him on these DEI issues when there was backlash, he did not say there was. And I just went back and asked about the conference call that they just did with reporters and again, he’s just insisting that it’s not really, it’s not, just not mentioning it as being a factor. I find that, surprising. But David, the problem with Target I think, and I’m gonna come back. . .is scale.
“They did buy back a lot of stock. . . they must have had much more faith than the street. You know they bought back 2.2 million shares at a 114 dollars a share. I would have never done that. Plays down any backlash from DEI. But the most important thing here, Carl, I just find is, this has been a, become a typical thing that Target has become a serial disappointer.
“I am questioning, how well it’s doing. It’s not big enough. They’re not opening a lot of stores, it’s part of urban strategy that seemed just okay. There were issues even, you know, off of George Floyd, but they recovered very quickly. . . .But I think that that’s more, if you might show some others, yeah Walmart’s really good too, TJX is really good too.
“Go look at the prices, when I. . .would walk with Brian through a Target store, I said this is too high, this is too high, this one’s too high. Where is the 2019? How about 2019 prices? I know that right now Walmart’s got some 2019 prices.
“Look, when you put up a chart of Dollar Tree, Dollar General, not Dollar Tree. Dollar General, I think that if Target can really lower price, you can have a kind of a conversion of. . .
“I’ve gone over this with Brian many times. I think everyone loves to go to Target. They’ve got those great brands that are their own. They have to cut price, cut price, cut price. They have no choice. They have to cut price.
Overall, TGT ranks 11th on our list of stocks that Jim Cramer discusses. While we acknowledge the potential of TGT as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than TGT and that has 100x upside potential, check out our report about this cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
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