TGT US S&P 500Russell 1000 Earnings call
Target Corporation (TGT) · Q2 2026 results and valuation
Share price: $162.70 · 2026-11-11
Target Corporation sells a variety of general merchandise and groceries through its physical stores and digital channels. The company serves individual consumers by offering a mix of national brands, owned brands, and third-party products. It operates in the retail sector, utilizing its stores as fulfillment hubs for both in-store and online shopping. Source: 10-K annual report (2026-03-11)
Results Q2 2026 vs Q1 2026 · previous quarter · fiscal Q2 2027 · published 19 Aug 2026 and 20 May 2026
Net income up 140.3% on the previous quarter. Management sounded about as positive as a typical company call, in its script and in answers to analysts.
1 · Numbers
+140.3%
Net income vs Q1 2026
Outlook given
Net income 1.88B vs 781.0M
Revenue +4.3%
Against the same quarter last year (Q2 2025) it is +100.7%, so it is not just seasonal.
Why Against the same quarter last year (+100.7%), net income rose because the gross margin rate was about 1 percentage point higher than last year as the company lapped elevated markdown and purchase order cancellation costs while benefiting from higher-margin revenue streams.
2 · How management spoke
Typical
Less upbeat than 55% of company calls
Answers to analysts: upbeat, in line with the script.
Similar to last call.
3 · What stood out
Target+ marketplace GMV and Target Circle 360 membership revenue both grew more than 40% compared to last year.
Valuation
Is Target Corporation undervalued?
Reverse DCF. Free cash flow from the last full fiscal year (2026-01-31), grown for 10 years, discounted back, plus a terminal value. “Implied growth” is the rate the current price assumes.
At −1.3% growth a year (3-year revenue growth), the model's fair value is $46.02 a share — the stock trades 254% above it. Today's price assumes 12.8% growth a year.
Current price
$162.70
close of 2026-11-11
Market implies growth of iThe yearly free-cash-flow growth, for the next 10 years, that today’s share price already assumes. If you believe the company grows faster than this, the stock is cheap under this model; slower, and it is expensive.
+12.8% for 10 yrs
Fair value / share
$46.02
Buy below
$34.51
Price vs fair value
Overvalued >200%
Price vs buy-below price
Overvalued >200%
Read between the lines
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Figure
These areas currently represent about 50% of sales and are expected to contribute more to the company's growth going forward.
Source quote
“Today, these areas represent about 50% of our sales, and we believe they will contribute even more to our growth going forward.”
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Guidance
Target+ marketplace GMV and Target Circle 360 membership revenue both grew more than 40% compared to last year.
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Guidance
Target's digital traffic from external AI platforms is growing more than 3.5x the industry compared to a year ago as consumers explore agentic shopping.
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Figure
Snack sales are running more than 15% ahead of last year due to momentum in protein bars, meat sticks, and better-for-you snacking options.
Source quote
“For example, post transition, snack sales are running more than 15% ahead of last year with outstanding momentum in protein bars, meat sticks, and better-for-you snacking options.”
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Guidance
Target will introduce Target Beauty Studio in more than 600 stores this quarter to create a more elevated Beauty destination and further its position as an industry leader.
4 more
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Figure
This past quarter, Target fulfilled nearly 30% more same-day and next-day units than last year, and it will continue investing to get even faster.
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Figure
Target raised its EPS range from $7.50 to $8.50 to a range of $9.90 to $10.90 to improve the bottom-line outlook.
Source quote
“On the bottom-line, we are raising our EPS range from $7.50 to $8.50 up to a range of $9.90 to $10.90.”
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Figure
Traffic growth increased by 3.6% over last year, which represents a slight acceleration on a 2-year basis compared to Q1.
Source quote
“As we continue to elevate what we sell and how we sell it, they're choosing us more often, reflected in another strong quarter of traffic growth, up 3.6% to last year, which is a slight acceleration on a 2-year basis compared to Q1.”
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Figure
Target lowered prices on more than 10,000 items over the past year to provide customers with a combination of style, quality, and affordability.
Source quote
“Over the past year alone, we've lowered prices on more than 10,000 items, reinforcing our commitment to ensuring families can find a unique combination of style, quality, and affordability every time they shop with us.”
Tone
How upbeat the language was, compared with other companiesiTone counts positive minus negative finance words, adjusted for length. Executives mostly speak positively, so the labels compare each call with every company's latest call: “typical” is the middle third, “very upbeat” the top tenth, “cautious” the bottom tenth.. Dot: Q2 2026. Ring: Q1 2026.
Script and answers carried a similar tone, so the script's message held up under questioning.
Sentences that drove the tone
“And importantly, the strength in the top line translated into strong underlying profit performance as well.”
“As a reminder, they include building a leading Beauty destination, expanding our role in Health and Wellness, being Food forward, celebrating baby and kid life, leading in women's style, inspiring...”
“As we continue to elevate what we sell and how we sell it, they're choosing us more often, reflected in another strong quarter of traffic growth, up 3.6% to last...”
Full figures
USD · SEC EDGAR XBRL (10-Q, period end 2026-08-01)
| Metric | Q2 2026period end 2026-08-01 | Q1 2026period end 2026-05-02 | Change | Q2 2025 | YoY |
|---|---|---|---|---|---|
| Revenue | 26.54B | 25.44B | +4.3% | 25.21B | +5.3% |
| Gross profit | 8.94B | 7.38B | +21.1% | 7.31B | +22.3% |
| Operating income | 2.56B | 1.14B | +125.6% | 1.32B | +94.4% |
| Net income | 1.88B | 781.0M | +140.3% | 935.0M | +100.7% |
| EPS | 4.11 | 1.71 | +140.4% | 2.05 | +100.5% |
| P/E today 16.4 | 15.0 | 17.0 | −2.0 | 11.6 | +3.4 |
Topics
Most discussed now
- Target's 4.6% full year adjusted operating margin rate in 2025, which represented a significant step back versus historical rates…
- Across each of these 4 priorities, Target is seeing encouraging momentum.
- Ultimately, that consistency needs to show up in the experience Target creates for its guests.
- You layer on the changes that Target made in Q2 with really big changes in the Food & Beverage business,...
- Target relaids its kids' floor pad, and it is actually seeing its kids basics running double digits, its tween Art Class...
Faded since Q1 2026
- Fading Delivering on Target's aspiration to be the most delightful shopping experience in retail means executing this strategy clearly and…
- Fading Product findability and in-stock availability remain the biggest friction points for Target's guests, particularly in high-frequency…
- Fading Adding network capacity with 2 recently opened facilities, a new receive center in Houston and a new food distribution center...
- Fading To do so, Target has introduced clearer merchandising standards, strengthen accountability within its teams and are simplifying how work…
Latest announcements
Official filings, newest first. Summaries are generated from each filing and its attachment; every figure is checked against the source.
- Results of operations · SEC 8-K
Target Corporation reported second-quarter net sales of $26.5 billion, up 5.3 percent from the previous year, and GAAP and Adjusted EPS of $4.11 compared to $2.05 a year earlier.
- Material agreement; Agreement terminated; New financial obligation · SEC 8-K
Target Corporation entered into a $4.0 billion unsecured revolving credit facility on August 14, 2026, while terminating its prior $3.0 billion and $1.0 billion credit agreements.
- Director or officer change · SEC 8-K
Target Corporation elected Joe DePinto as a director and member of the Audit & Risk and Infrastructure & Finance committees, effective August 1, 2026.
- Director or officer change; Shareholder vote results · SEC 8-K
Shareholders approved the Amended and Restated Target Corporation 2020 Long-Term Incentive Plan with 95.0% of the votes cast.
- Results of operations · SEC 8-K
Target Corporation reported first-quarter net sales of $25.4 billion, up 6.7 percent from the previous year, with GAAP and Adjusted EPS of $1.71.
- Results of operations · SEC 8-K
Target Corporation reported fourth-quarter net sales of $30.5 billion, a 1.5 percent decrease from the previous year, and full-year GAAP EPS of $8.13 compared to $8.86 in 2024.
- Results of operations · SEC 8-K
Target Corporation announced on February 10, 2026, that it expects to report fourth quarter 2025 sales and full-year GAAP and Adjusted earnings per share in line with its previously issued guidance.
- Director or officer change · SEC 8-K
Target Corporation appointed Lisa Roath as Executive Vice President and Chief Operating Officer with an annual base salary of $775,000, effective February 15, 2026, while Rick Gomez will step down as Chief Commercial Officer.
Catalyst calendar
management-stated targets — from the latest earnings call; plans, not promises.
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later this quarter
introduction of Target Beauty Studio in more than 600 stores
Source quote
“And later this quarter, we'll introduce Target Beauty Studio in more than 600 stores, creating a more elevated Beauty destination and furthering our solid foundation as an industry leader in this space.”
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yet this year
additional price reductions
Source quote
“We've already lowered prices on more than 10,000 items over the last 12 months and are planning for additional price reductions yet this year.”
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throughout the third quarter
giving guests reasons to choose Target through differentiated owned brands, exclusive partnerships, and compelling value
Source quote
“And throughout the third quarter, we'll continue giving our guests reasons to choose Target through differentiated owned brands, exclusive partnerships, and compelling value.”
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next month
unveil these new offerings at more than 600 stores
Source quote
“The new spaces are under construction as we speak, and we're excited to unveil these new offerings at more than 600 stores beginning next month.”
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full year
CapEx
Source quote
“We continue to expect approximately $5 billion of CapEx for the full year as we invest behind the strategic growth priorities we outlined in March.”