TLDR
Target reported Q1 EPS of $1.71, beating the $1.46 estimate, with revenue of $25.44 billion topping the $24.66 billion consensus.
Net sales grew 6.7% year-over-year, with comparable sales up 5.6% and digital comparable sales rising 8.9%.
Same-day delivery via Target Circle 360 surged more than 27%, driving digital growth.
Non-merchandise sales jumped nearly 25%, fueled by Roundel ad revenue, memberships, and the Target+ marketplace.
Target raised its full-year net sales growth outlook to ~4%, up from a prior 2% target.
Target (TGT) stock was trading around 1.4% higher in premarket on Wednesday after the retailer posted a stronger-than-expected first quarter.
EPS came in at $1.71 against the $1.46 analyst estimate. Revenue hit $25.44 billion, clearing the $24.66 billion consensus.
Net sales grew 6.7% year-over-year. Comparable sales rose 5.6%, and comparable traffic was up 4.4% versus Q1 2025.
Digital comparable sales climbed 8.9%. The standout number there was same-day delivery, which grew more than 27%, powered by Target Circle 360 memberships.
Non-merchandise sales jumped nearly 25%. That category includes Roundel — Target’s retail media network — along with Target Circle 360 membership revenue and the Target+ marketplace.
CEO Michael Fiddelke said the Q1 results were “stronger than expected” and described them as “encouraging early signs” that the company’s updated strategy is connecting with customers.
Full-Year Outlook Gets a Lift
Target raised its full-year 2026 net sales growth forecast to approximately 4%, up from a prior estimate of 2%. That’s a meaningful revision for a retailer of this size.
The company now expects full-year adjusted EPS near the high end of its previous guidance range of $7.50 to $8.50. The midpoint of $8.00 is in line with what analysts had penciled in.
Target also projected full-year 2026 operating income margin more than 20 basis points above the 4.6% adjusted rate it posted in 2025.
Valuation and Insider Activity
TGT’s current P/E ratio sits at 15.65, considered fairly moderate for the retail sector. The P/S ratio of 0.55 suggests the stock is trading at a discount to sales.
The GF Score stands at 79 out of 100, with profitability rated 7/10 and financial strength at 6/10. Growth scores a 4/10, pointing to some longer-term questions around sustaining the current pace.
On the insider front, company insiders sold approximately $6.3 million worth of stock over the past three months. That’s worth watching.
Target fulfills more than 97% of its sales through its physical store network, which continues to act as a logistics backbone for its digital growth.
The company operates nearly 2,000 stores and posted over $104 billion in sales in fiscal 2025.
Comparable traffic growth of 4.4% shows more customers actually walking through the doors — or visiting the app — not just bigger basket sizes.
The Target+ marketplace and Roundel ad revenue are becoming a more visible part of the business, with non-merchandise revenue nearly 25% higher than a year ago.
Target’s updated 4% net sales growth forecast for the full year is double what it was guiding for just a quarter ago.
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