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Target Corporation - Investment Thesis, Key Drivers, Financial & Price Forecasts, DCF Valuation 9/21
Target Corporation experienced a strong second-quarter performance, and went past the target price from our last report as a result of its highly resilient operations, and a passionate, top-notch team. Their second-quarter total sales have increased by over $6.6 billion or 36% over the last two years and the company also witnessed an 8% margin expansion at the bottom-line level. The company’s strong performance was largely driven by excellent comparable digital sales, which grew by 10% in the second quarter, building on the record growth of 195% in 2020. The digital channel continues to be led by their same-day services, in-store pickup, Drive Up, and Shipt, which together grew by 55% in 2021, on top of over 270% last year. In June 2021, the management went forward with the launch of Target Forward, an ambitious new sustainability strategy grounded in the division to co-create an equitable and regenerative future with their partners, communities, and guests. Target’s multi-modal approach to shopping is a major green flag, and we give the stock a 'Hold' rating with a revised target price. Baptista Research looks to evaluate the different factors that could influence the company's price in the near future and attempts to carry out an independent valuation of the company using a Discounted Cash Flow (DCF) methodology. In this report, we have carried out reasonable forecasts of the annualized income statement and cash flows and carried out a DCF valuation of the company using its Weighted Average Cost of Capital (WACC) to determine a forecasted share price.
LIBERUM: Topps Tiles* - Strong FY22 beat and an encouraging start to FY23E
Companies: Topps Tiles Plc