Target Aims At Thriving Despite Slowdown In Broader Economy

According to an article on Barron's, Target Corp TGT, the Minneapolis-based discounter, has carved out a niche for itself. The company thrived on its looks-are-deceiving formula until 2008, when the financial markets suffered a big jolt, the economy crashed and most Americans opted for Wal-Mart WMT, which offered even lower prices, without giving a thought for style. As customers shifted their loyalty, the company’s sales and profits plummeted. TGT’s shares, which once traded at $75, also had a free fall to $25. However, the retailer that can make potholders sing should not be underestimated. Target is ready with a comeback plan that seems ready to win new fans on Wall Street, where the shares are trading just like the company’s merchandise – chic, yet cheap. The stock surged slightly last week to around $52, after the company announced on Thursday that its same-store sales rose 2% in July, despite signs of slowdown in broader economy. Adrianne Shapira, a retailing analyst at Goldman Sachs, said in her recent report, “Consumers do not appear to be returning to their bunker of late 2008 and early 2009.” Although she maintains her “neutral” rating on the stock, she indicated that she is "warming up to the Target story," as the company has many "unique top-line drivers that aren't dependent on a macro recovery." Read more from Benzinga's Markets.