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Recent developments in the retail industry have stirred significant concern among investors, particularly due to the introduction of new tariffs by the U.S. government, which is seen by the market as extending a new trade war.
Major retailers like Best Buy (NYSE: BBY) and Target (NYSE: TGT) have issued warnings regarding potential price increases and profit pressures, which have led to notable fluctuations in their stock prices.

Impact of US Tariffs on Retail Giants

Best Buy has sounded the alarm over possible price hikes for American consumers as a result of newly imposed tariffs. The tariffs include a 25% duty on imports from Mexico and Canada, along with a doubling of duties on Chinese goods to 20%.
While Best Buy reported a surprising rise in holiday quarter sales, its shares plummeted by 13% in early trading. The company achieved a 0.5% increase in fourth-quarter comparable sales, surpassing expectations of a 1.33% decline. Adjusted earnings per share were $2.58, exceeding the predicted $2.40. Looking ahead, Best Buy anticipates fiscal year 2026 comparable sales to remain flat or increase by up to 2%, which falls short of analyst forecasts and does not account for the tariff impacts. Additionally, there is concern about consumer reactions to potential price increases, especially amid recent declines in U.S. consumer spending.
Target is also feeling the heat from tariffs, warning that they could exert pressure on its first-quarter profits. In response, the company is seeking to diversify its product sourcing by turning to countries like Guatemala to mitigate tariff effects. Despite a 1.5% rise in holiday quarter sales driven by promotions, Target’s shares dropped by 6% due to concerns over tariffs and tepid demand. The retailer plans to invest $5 billion in enhancing its stores and technology.
Target’s annual earnings forecast aligns with estimates but excludes the potential impact of tariffs. The company is also navigating stiff competition from Walmart and Amazon while working to reduce its dependency on Chinese imports.

Best Buy and Target Stock Plummet as Trade War Continues

Best Buy’s stock has experienced significant volatility in light of recent announcements. The stock, which closed at $86.74 previously, opened at $79.44 on March 4, 2025, and fell to a current price of $74.01 as of midday. It reached a low of $72.92 and a high of $80.13 during the day. Over the past year, the stock has fluctuated between a low of $69.29 and a high of $103.71.
Best Buy’s market capitalization stands at approximately $16.4 billion, with a dividend yield of 4.33%. Analysts have given the stock a “Buy” recommendation, with a target price ranging from $80.00 to $117.00.
Similarly, Target’s stock has seen downward pressure, with a previous close at $120.76 and an opening price of $117.50 on the same day. The current price has dipped to $114.48, with a day’s low of $112.53 and a high of $118.10.
The stock’s 52-week range spans from a low of $112.53 to a high of $181.86. Target’s market capitalization is approximately $54 billion, and it offers a dividend yield of 3.71%. Analysts have also rated Target as a “Buy,” with price targets ranging from $103.00 to $170.00.

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