1、CrispIdea|R E S E A R C HTeradata CorporationE Q U I T Y R E S E A R C H Retail|Discount Stores|Aug 05,2024Target CorpBoosting growth with Target Circle and ShopifyWe maintain our“HOLD”rating and downgrade our target price to$161 from$172 for TGT which implies an upside potential of 8%for FY26.We de

2、rive our target price based on an EV/EBITDA of 9.4x,along with a forward earning multiple of 15.35x and an adj.EPS of$10.49 for FY26.Moreover,we expect EV/EBITDA of 9.6x,along with a forward earning multiple of 16.50 x and an adj.EPS of$9.40 for FY25.Our estimates are based on 1)Relaunch of Target C

3、ircle 2)Macroeconomic pressures 3)Roll out of Store Companion 4)Increased SG&A expenses and 5)Partnership with ShopifyIndustry Analysis:Discount Stores are anticipated to reach$834.74bn by 2030,growing at a CAGR of 5.35%from 2023 to 2030.The global discount store market has fared well due to the imp

4、act of the economic recession on consumer spending patterns,and the industry has long offered price conscious consumers which is an alternative to expensive retail outfits.In recent years,the economic recession and its aftermath have meant that more and more consumers have joined the ranks of the pr

5、ice-conscious.Relaunch of Target Circle:TGT has been delivering value to customers not just through low prices,but also through its Target Circle loyalty program which was relaunched in April.This program has grown to over 100mn members,making it one of the largest in the U.S.The redesigned program

6、now integrates TGTs credit and debit card offerings with same-day delivery options,providing a variety of services and rewards tailored to customers needs.The consumer response has been positive,with over 1mn new members added in the last quarter.The company plans to continue investing in the progra