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Target (TGT) is scheduled to report results of its fourth quarter before the market open on Tuesday, March 5. The company will host its 2024 Financial Community Meeting at 9 am EST. What to watch for:

Guidance: In November, Target forecast Q4 adjusted earnings per share of $1.90-$2.60 and comparable sales "in a wide range" around a mid-single digit decline. Analysts currently expect quarterly EPS of $2.41. At the time, the company said its Q4 EPS guidance implied that fiscal 2023 EPS would be "very close" to the original guidance range. While Target remained "cautious" in its near-term outlook, CEO Brian Cornell said the company had seen "meaningful improvement" in profitability.

Oppenheimer continues to expect a mid-single-digit comp decline, but is now modeling EPS above the midpoint of Q4 guidance. For FY24, it expects conservative targets similar to recent practices bracketing its $8.75 figure vs. a Street estimate of $9.14. Oppenheimer also believes management could update intermediate term operating margin targets. The firm continues to see a path to a nearly 6% operating margin and $10-plus in earnings by FY25.

'Tactical Underperform': Evercore ISI initiated a "negative Tactical Trading Call" on Target on February 14 while adding the stock to the firm's "Tactical Underperform" list. The firm's talks with investors suggest they are getting more constructive on Target and while Evercore thinks this "less bad" trade is warranted, it takes a "somewhat more cautious stance" on the rate of improvement given competition, near term consumer spending volatility, ongoing inflationary cost pressures and reinvestment needs, the analyst told investors.

Compelling Setup: UBS said last month that the stock offers a "compelling setup" heading into Q4 and 2024. The firm contended that the company will be able to get back to growing both its sales and profits this year, which will propel its stock higher. Q4 comps probably remained under pressure, but Target will have likely managed its profitability well, the analyst said.

Potential Paid Membership Program: Target, which already offers a free loyalty program called Target Circle, is considering the addition of a new paid membership program similar to Amazon Prime (AMZN) or Walmart's (WMT) Walmart+ as it looks for ways to fuel growth and better compete, people familiar with the matter told Bloomberg's Jaewon Kang in February. The initiative, titled Project Trident internally, could launch as soon as this year, the sources said.

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