Target’s Shares to Continue Slide as JPMorgan Downgrades Stock

Target shares traded lower on Thursday after JPMorgan analysts downgraded the stock and lowered their 12-month price target on the company.

Declining market share, a weakening consumer base and high exposure to younger customers were among the reasons they cited for lowering their rating from "overweight" to "neutral." And more bad news for the big-box retailer could be on the way.

“The prospect for additional downward revisions is rising,” the analysts wrote, reducing their price target on the stock to $144 per share, down from $182.
The stock was trading for about $129, down a little over 1%. The stock has fallen nearly 14% year-to-date.

Target has endured a culture-war uproar for selling Pride Month merchandise, including LQBTQ-themed clothing for infants and children. It has lost about $13 billion in market capitalization since the blowback began in mid-March.

The JPMorgan analysts cited a broader and perhaps longer decline in traffic and market share in downgrading the stock.

“We believe this share loss could accelerate into back to school and linger into holiday given consumer pressures and recent company controversies," the analysts wrote. The analysts worry that Target's foot traffic could fall during the two critical shopping seasons after 12 strong quarters in a row. "This shift is generally bad for retail stock valuation given attribution is highest at the topline and, particularly for traffic."