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Target Corp. (TGT) Fundamental Analysis & AI Grade 2026

TGT NYSE Retail-Variety Stores MN CIK: 0000027419
Updated This Month • Analysis: May 30, 2026 • SEC Data: 2026-05-02
Combined AI Grade
C
73% Confidence
AGREEMENT
C
68% Conf
B
78% Conf

📊 TGT Key Takeaways

Revenue: $25.4B
Net Margin: 3.1%
Free Cash Flow: $-319.0M
Current Ratio: 0.93x
Debt/Equity: 0.87x
EPS: $1.71
AI Grade: C with 68% confidence
Target Corp. (TGT) receives a C fundamental grade with 73% confidence from our AI analysis based on SEC 10-K filings. With revenue of $25.4B, net profit margin of 3.1%, and return on equity (ROE) of 4.8%, Target Corp. demonstrates mixed fundamentals in the Consumer sector. Below is our complete TGT stock analysis for 2026.

Is Target Corp. (TGT) a Good Investment?

Claude

Target faces fundamental headwinds with declining revenue (-1.7% YoY) and contracting profitability (EPS -8.2% YoY), compounded by negative free cash flow of -$319M despite operating cash flow of $716M. Weak returns on capital (ROE 4.8%, ROA 1.3%) and liquidity stress (current ratio 0.93x) signal operational challenges, though strong gross margins (81.6%) indicate the business retains underlying pricing power.

ChatGPT

Target’s fundamentals show a still-profitable large-scale retailer with solid gross profitability, strong interest coverage, and positive free cash flow generation. However, declining revenue, weaker earnings, thin retail margins, and tight liquidity suggest the business is stable rather than strengthening. The company appears financially resilient, but growth quality and near-term profit momentum are not strong enough to justify a more bullish fundamental view.

Target Corp. Key Strengths (TGT)

Claude
  • + Exceptional gross margin of 81.6% demonstrates pricing power and operational efficiency
  • + Manageable debt/equity ratio of 0.87x with strong interest coverage of 10.7x indicates debt is serviceable
  • + Large asset base of $58B provides scale and competitive infrastructure
ChatGPT
  • + Strong absolute profitability with $5.12B operating income and $3.71B net income
  • + Excellent interest coverage of 48.3x indicates debt is currently very manageable
  • + Positive operating cash flow and free cash flow support ongoing investment and shareholder flexibility

TGT Stock Risks: Target Corp. Investment Risks

Claude
  • ! Negative free cash flow of -$319M is unsustainable and indicates cash burn despite capital investments
  • ! Current ratio of 0.93x and quick ratio of 0.30x signal working capital stress and potential liquidity constraints
  • ! Revenue contraction and declining earnings momentum suggest market share or demand erosion in competitive retail landscape
ChatGPT
  • ! Revenue and net income are both declining, pointing to weak top-line momentum and earnings pressure
  • ! Low current ratio and very low quick ratio indicate limited liquidity cushion
  • ! Free cash flow margin of 2.7% is modest, leaving less room if margins weaken further

Key Metrics to Watch

Claude
  • * Free cash flow trajectory and operating cash flow sustainability relative to capital expenditure
  • * Current and quick ratios for liquidity deterioration or improvement
  • * Operating margin expansion potential given high gross margins
ChatGPT
  • * Comparable sales/revenue growth and operating margin trend
  • * Free cash flow generation relative to capital expenditures and debt levels

Target Corp. (TGT) Financial Metrics & Key Ratios

Revenue
$25.4B
Net Income
$781.0M
EPS (Diluted)
$1.71
Free Cash Flow
$-319.0M
Total Assets
$58.0B
Cash Position
$3.5B

💡 AI Analyst Insight

The current ratio below 1.0x warrants monitoring of short-term liquidity.

TGT Profit Margin, ROE & Profitability Analysis

Gross Margin 81.6%
Operating Margin 4.5%
Net Margin 3.1%
ROE 4.8%
ROA 1.3%
FCF Margin -1.3%

TGT vs Consumer Sector: How Target Corp. Compares

How Target Corp. compares to Consumer sector averages

Net Margin
TGT 3.1%
vs
Sector Avg 8.0%
TGT Sector
ROE
TGT 4.8%
vs
Sector Avg 18.0%
TGT Sector
Current Ratio
TGT 0.9x
vs
Sector Avg 1.5x
TGT Sector
Debt/Equity
TGT 0.9x
vs
Sector Avg 0.8x
TGT Sector

Sector benchmarks are approximate industry averages. Actual sector performance may vary.

Is Target Corp. Stock Overvalued? TGT Valuation Analysis 2026

Based on fundamental analysis, Target Corp. has mixed fundamental signals relative to the Consumer sector in 2026.

Return on Equity
4.8%
Sector avg: 18%
Net Profit Margin
3.1%
Sector avg: 8%
Revenue Growth
N/A
Year-over-year
Debt/Equity
0.87x
Sector avg: 0.8x

Note: This is a fundamental analysis based on SEC filings. For P/E ratio, price targets, and market-based valuation, consult financial data providers. This is not investment advice.

Target Corp. Balance Sheet: TGT Debt, Cash & Liquidity

Current Ratio
0.93x
Quick Ratio
0.30x
Debt/Equity
0.87x
Debt/Assets
0.0%
Interest Coverage
10.71x
Long-term Debt
$14.3B

TGT Revenue & Earnings Growth: 5-Year Financial Trend

TGT 5-year financial data: Year 2021: Revenue $106.0B, Net Income N/A, EPS $6.36. Year 2022: Revenue $109.1B, Net Income $4.4B, EPS $8.64. Year 2023: Revenue $109.1B, Net Income $6.9B, EPS $14.10. Year 2024: Revenue $109.1B, Net Income $2.8B, EPS $5.98. Year 2025: Revenue $107.4B, Net Income $4.1B, EPS $8.94.
Revenue
Net Income
EPS (right axis)

5-Year Trend Summary: Target Corp.'s revenue has shown modest growth of 1% over the 5-year period. The most recent EPS of $8.94 reflects profitable operations.

TGT Revenue Growth, EPS Growth & YoY Performance

Revenue Growth
N/A
Year-over-year
Net Income Growth
N/A
Year-over-year
EPS Growth
N/A
Earnings per share
FCF Margin
-1.3%
Free cash flow / Revenue

TGT Quarterly Earnings & Performance

Quarterly financial performance data for Target Corp. including revenue, net income, and earnings per share.
Quarter Revenue Net Income EPS
Q1 2026 $23.8B $689.0M $1.71
Q3 2025 $25.3B $689.0M $1.51
Q2 2025 $25.2B $854.0M $2.05
Q1 2025 $23.8B $854.0M $2.03
Q3 2024 $25.4B $835.0M $1.85
Q2 2024 $24.8B $835.0M $1.80
Q1 2024 $24.5B $835.0M $2.03
Q3 2023 $25.4B $183.0M $1.54

Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.

Target Corp. Dividends, Buybacks & Capital Allocation

Operating Cash Flow
$716.0M
Cash generated from operations
Capital Expenditures
$1.0B
Investment in assets
Dividends Paid
$516.0M
Returned to shareholders

TGT SEC Filings: Latest 10-K & 10-Q Analysis

Access official SEC EDGAR filings for Target Corp. (CIK: 0000027419)

📋 Recent SEC Filings

Date Form Document Action
Jun 1, 2026 4 xslF345X06/wk-form4_1780348153.xml View →
May 29, 2026 10-Q tgt-20260502.htm View →
May 28, 2026 4 xslF345X06/wk-form4_1780002107.xml View →
May 20, 2026 8-K tgt-20260520.htm View →
Apr 27, 2026 DEF 14A tgt-20260426.htm View →

Frequently Asked Questions about TGT

What is the AI rating for TGT?

Target Corp. (TGT) has a Combined AI Grade of C from Claude (C) and ChatGPT (B) with 73% combined confidence, based on fundamental analysis of SEC EDGAR filings.

What are TGT's key strengths?

Claude: Exceptional gross margin of 81.6% demonstrates pricing power and operational efficiency. Manageable debt/equity ratio of 0.87x with strong interest coverage of 10.7x indicates debt is serviceable. ChatGPT: Strong absolute profitability with $5.12B operating income and $3.71B net income. Excellent interest coverage of 48.3x indicates debt is currently very manageable.

What are the risks of investing in TGT?

Claude: Negative free cash flow of -$319M is unsustainable and indicates cash burn despite capital investments. Current ratio of 0.93x and quick ratio of 0.30x signal working capital stress and potential liquidity constraints. ChatGPT: Revenue and net income are both declining, pointing to weak top-line momentum and earnings pressure. Low current ratio and very low quick ratio indicate limited liquidity cushion.

What is TGT's revenue and growth?

Target Corp. reported revenue of $25.4B.

Does TGT pay dividends?

Target Corp. pays dividends, with $516.0M distributed to shareholders in the trailing twelve months.

Where can I find TGT SEC filings?

Official SEC filings for Target Corp. (CIK: 0000027419) including 10-K, 10-Q, and 8-K reports are available on SEC EDGAR.

What is TGT's EPS?

Target Corp. has a diluted EPS of $1.71.

How is the AI analysis conducted?

Two independent AI systems — Claude (Anthropic) and ChatGPT (OpenAI) — analyze SEC EDGAR filings including 10-K annual reports and 10-Q quarterly reports. Each AI evaluates financial health, profitability ratios, balance sheet strength, and growth metrics. The combined grade reflects both perspectives for balanced insights.

What is TGT's fundamental grade?

Based on our AI fundamental analysis in June 2026, Target Corp. has a C grade with 73% confidence. Review the strengths and risks sections above for full context. This is not investment advice.

Is TGT stock overvalued or undervalued?

Valuation metrics for TGT: ROE of 4.8% (sector avg: 18%), net margin of 3.1% (sector avg: 8%). Compare these metrics with sector averages to assess valuation.

What is TGT's AI grade for 2026?

Our dual AI analysis gives Target Corp. a combined C grade for 2026. Revenue is data pending, with profitability at or below sector average. Always conduct your own research.

What is TGT's free cash flow?

Target Corp.'s operating cash flow is $716.0M, with capital expenditures of $1.0B. FCF margin is -1.3%.

How does TGT compare to other Consumer stocks?

Vs Consumer sector averages: Net margin 3.1% (avg: 8%), ROE 4.8% (avg: 18%), current ratio 0.93 (avg: 1.5).

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Disclaimer: This analysis is generated by Claude AI (Anthropic) and ChatGPT (OpenAI) based on publicly available SEC EDGAR filings. It does not include stock price data and should not be considered financial advice. All fundamental data is sourced from SEC public domain filings. Always conduct your own research and consult with a qualified financial advisor before making investment decisions.
Data Source: SEC EDGAR | Analysis Date: May 30, 2026 | Data as of: 2026-05-02 | Powered by Claude AI