- A Look At Target (TGT) Valuation After Turnaround Doubts And Consumer Pressure Weigh On Shares
May 13, 2026
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Target (TGT) is back in focus after a sharp share price pullback as investors react to fresh skepticism about the new CEO’s turnaround plan and growing worries about strained consumer budgets and higher gas prices.
See our latest analysis for Target.
The recent pullback comes after a strong run, with a year to date share price return of 21.18% and a 1 year total shareholder return of 29.76%. This comes even as recent headlines around consumer strain, insider selling and questions about the turnaround have cooled shorter term momentum.
If Target’s volatility has you thinking about diversification, this could be a good moment to broaden your search and check out 20 top founder-led companies
With Target shares still up 21.18% year to date but now trading below recent highs and at about a 26.60% intrinsic discount, the key question is whether this pullback is a genuine opening or whether the market already reflects future growth.
Most Popular Narrative: 26.2% Overvalued
The most followed narrative puts Target’s fair value at $96.52, which sits well below the latest close of $121.80 and frames the recent pullback very differently to the headline reaction.
The latest round of analyst commentary on Target offers a balanced mix of optimism and caution, as experts digest the company’s quarterly performance and forward-looking strategies.
Bullish analysts highlight that recent results were generally in-line with expectations, with promising initiatives aimed at driving growth and efficiency over the long term.
Read the complete narrative.
Want to see what really sits behind that fair value gap? The narrative leans heavily on modest revenue growth, pressured margins, and a future earnings multiple that has to do a lot of work.
Result: Fair Value of $96.52 (OVERVALUED)
Have a read of the narrative in full and understand what's behind the forecasts.
However, there are clear swing factors, including Target’s US$31b owned brands and growing higher margin digital businesses such as Roundel and Target Plus, that could challenge this cautious view.
Find out about the key risks to this Target narrative.
Another View: Market Pricing Versus Cash Flow Value
The overvalued narrative built on a $96.52 fair value is only one lens. Our DCF model points in the opposite direction, with Target trading about 26.6% below its estimated future cash flow value of $165.93. This raises a different question: is the cash flow outlook too generous, or is the market too cautious?
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Look into how the SWS DCF model arrives at its fair value.TGT Discounted Cash Flow as at May 2026
Next Steps
With mixed signals on value and future cash flow, sentiment is clearly split. Move quickly to test the assumptions yourself and weigh up the 4 key rewards and 2 important warning signs.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Companies discussed in this article include TGT.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com
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- Target Onside Partnership Puts Men’s Wellness And Valuation In Focus
May 12, 2026
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Target (NYSE:TGT) is launching an exclusive nationwide partnership with Onside, a new men's personal care brand. Onside products will roll out across Target stores and online, expanding the retailer's men's wellness and self-care offerings. The move adds a premium but accessible line aimed at attracting shoppers looking for men's grooming and wellness products.
Target, trading at $121.8, has seen the stock rise 21.2% year to date and 29.8% over the past year. Returns over 3 and 5 years show declines of 13.3% and 31.3%. The exclusive Onside launch comes as the company looks to deepen its presence in men's wellness, a category that has been gaining attention across retail.
For investors watching NYSE:TGT, this new partnership adds another piece to the story of how Target is refining its assortment to reach different customer segments. The rollout of Onside provides another concrete development to track when assessing how the company's merchandising choices align with changing shopper preferences.
Stay updated on the most important news stories for Target by adding it to your watchlist or portfolio. Alternatively, explore our Community to discover new perspectives on Target.NYSE:TGT Earnings & Revenue Growth as at May 2026
We've flagged 2 risks for Target. See which could impact your investment.
Quick Assessment
⚖️ Price vs Analyst Target: At US$121.8, Target trades about 3.6% below the US$126.31 analyst consensus target, which sits well inside the forecast range of US$88 to US$160. ✅ Simply Wall St Valuation: Simply Wall St estimates the stock is trading about 26.6% below its fair value, which screens as undervalued. ❌ Recent Momentum: The share price is roughly flat over 30 days, with a slight 0.1% decline.
There is only one way to know the right time to buy, sell or hold Target. Head to Simply Wall St's company report for the latest analysis of Target's Fair Value.
Key Considerations
📊 The exclusive Onside partnership adds another category extension in men's wellness that you can track against Target's US$104.8b revenue base. 📊 Watch same store sales, online traffic and any category level disclosure in men's personal care to see whether this launch gains traction. ⚠️ With two flagged risks including significant insider selling and a high level of debt, consider how additional assortment investments fit alongside balance sheet and capital allocation priorities.
Dig Deeper
For the full picture including more risks and rewards, check out the complete Target analysis. Alternatively, you can check out the community page for Target to see how other investors believe this latest news will impact the company's narrative.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Companies discussed in this article include TGT.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com
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- Target (TGT) Gains As Market Dips: What You Should Know
May 12, 2026
Target (TGT) ended the recent trading session at $121.77, demonstrating a +2.81% change from the preceding day's closing price. The stock's change was more than the S&P 500's daily loss of 0.16%. Meanwhile, the Dow gained 0.11%, and the Nasdaq, a tech-heavy index, lost 0.71%.
The stock of retailer has risen by 0.48% in the past month, lagging the Retail-Wholesale sector's gain of 3.35% and the S&P 500's gain of 8.81%.
Market participants will be closely following the financial results of Target in its upcoming release. The company plans to announce its earnings on May 20, 2026. The company is predicted to post an EPS of $1.34, indicating a 3.08% growth compared to the equivalent quarter last year. Alongside, our most recent consensus estimate is anticipating revenue of $24.28 billion, indicating a 1.81% upward movement from the same quarter last year.
TGT's full-year Zacks Consensus Estimates are calling for earnings of $8.02 per share and revenue of $106.8 billion. These results would represent year-over-year changes of +5.94% and +1.93%, respectively.
It's also important for investors to be aware of any recent modifications to analyst estimates for Target. These latest adjustments often mirror the shifting dynamics of short-term business patterns. As such, positive estimate revisions reflect analyst optimism about the business and profitability.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Within the past 30 days, our consensus EPS projection has moved 0.26% lower. Right now, Target possesses a Zacks Rank of #3 (Hold).
Digging into valuation, Target currently has a Forward P/E ratio of 14.78. This denotes a discount relative to the industry average Forward P/E of 25.93.
Investors should also note that TGT has a PEG ratio of 4.94 right now. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. TGT's industry had an average PEG ratio of 2.92 as of yesterday's close.
The Retail - Discount Stores industry is part of the Retail-Wholesale sector. This industry, currently bearing a Zacks Industry Rank of 55, finds itself in the top 23% echelons of all 250+ industries.
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The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
You can find more information on all of these metrics, and much more, on Zacks.com.
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Target Corporation (TGT) : Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).
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- Wells Fargo, Barclays Lift Target (TGT) Price Targets Following Improved Setup
May 12, 2026
With a 5-year average dividend growth rate of 10.95%, Target Corporation (NYSE:TGT) is included among the 14 Best Dividend Stocks to Buy for Steady Growth.Wells Fargo, Barclays Lift Target (TGT) Price Targets Following Improved Setup
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On May 12, Wells Fargo raised its price recommendation on Target Corporation (NYSE:TGT) to $140 from $135. It reiterated an Overweight rating on the shares. The firm said the setup around Target looked encouraging, with the potential for Q1 upside and a possible guidance increase, especially on sales.
The same day, Barclays analyst Seth Sigman raised the firm’s price goal on Target to $115 from $108. It kept an Underweight rating on the stock. Barclays said it sees Target “getting back to the baseline” following the sales and margin reset in 2025.
On May 10, CNBC reported that Target is expanding its baby category as part of a broader push to bring families back into stores and improve sales growth under CEO Michael Fiddelke. The retailer has launched “baby boutiques” in around 200 stores. These sections feature premium brands, display models of strollers and car seats, and nearly 2,000 new baby products.
Chief Merchandising Officer Cara Sylvester said families with young children tend to spend more and shop more frequently than the average customer, making them an important group for the company. Target also believes stronger connections with parents can help increase sales in groceries, apparel, and household essentials. The expansion comes as Target deals with rising competition from Walmart and Amazon, while its share of the U.S. baby retail market has slipped in recent years. Even with lower birth rates in the U.S., the company still views the baby category as an important part of building long-term customer loyalty and supporting its broader turnaround efforts.
Target Corporation (NYSE:TGT) is a general merchandise retailer that sells products through its stores and digital platforms. The company offers everyday essentials and differentiated merchandise at discounted prices to its customers, whom it refers to as guests.
While we acknowledge the potential of TGT as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.
READ NEXT: 10 Best Inflation-Hedge Stocks to Buy for 2026 and 10 Best Stocks to Buy to Beat the S&P 500
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- Target Likely to Post Strong First-Quarter Comparable Sales Growth, UBS Says
May 12, 2026
Target (TGT) is expected to post strong fiscal first-quarter comparable sales growth, indicating a "
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- Target Q1 Results Set to Validate Turnaround Momentum, UBS Says
May 12, 2026
Target (TGT) has a compelling catalyst path ahead, with its upcoming Q1 results expected to validate
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- Should Investors Buy Costco Stock Now After Strong April Retail Sales?
May 12, 2026
Costco Wholesale Corporation’s COST April sales update offers fresh insight into the retail giant’s momentum. A dominant force in the warehouse club space with a long track record of growth, Costco has remained an investor favorite. However, the latest sales figures raise a key question: Should investors buy the stock now, hold their positions or book profits?
The April report showed solid comparable sales growth across regions, along with accelerating e-commerce sales. This reinforces the view that Costco’s operational execution and customer loyalty remain strong despite a challenging retail backdrop.
Breaking Down Costco’s April Sales Report
Costco’s membership-driven model remains a core strength, with high renewal rates ensuring a dependable revenue stream. Its efficient supply chain and bulk purchasing power enable competitive pricing, reinforcing its strong market position. This combination of customer loyalty and operational efficiency continues to give Costco an advantage in a competitive retail landscape.
For the four weeks ended May 3, 2026, Costco reported an 11.6% year-over-year increase in total comparable sales, reflecting broad-based momentum across geographies. Comparable sales rose 11.7% in the United States and 11.5% in both Canada and Other International markets, indicating resilient demand despite macroeconomic uncertainty. (Read: Costco's April Sales Growth Highlights Strength in Membership Model)
However, a closer look at the report shows that part of the growth was aided by calendar-related factors. April included an extra shopping day compared with the prior year due to the Easter shift, which boosted total and comparable sales by roughly 1.5% to 2%. Even after adjusting for this benefit, Costco’s underlying sales trends remained solid, suggesting that customer traffic and spending patterns continue to hold up well.
Unlocking Costco’s Growth Drivers
Costco continues to demonstrate the strength of its membership-driven model, which underpins a stable and recurring revenue base. The annual fee structure not only ensures predictable income but also reinforces a sense of exclusivity and value for members. This dynamic was evident in the second quarter of fiscal 2026 when membership fee income advanced 13.6% year over year, supported by robust renewal rates of 92.1% in the United States and Canada and 89.7% globally, highlighting strong customer engagement.
The company’s focus on value remains central to its competitive positioning. By offering high-quality merchandise at prices lower than its peers, Costco reinforces customer loyalty and encourages frequent store visits. Its curated merchandising strategy, featuring a dynamic assortment of essentials, seasonal goods and unique offerings, keeps the shopping experience engaging while driving incremental purchases.
Private label expansion remains a key differentiator, with the Kirkland Signature brand playing an important role in driving both customer loyalty and margin efficiency. Known for delivering premium quality at compelling price points, Kirkland enhances Costco’s value proposition. The ongoing addition of new products across categories further strengthens brand equity and supports profitability. Costco launched about 30 new Kirkland items in the second quarter.
At the same time, Costco is leveraging technology to enhance the overall member experience and operational efficiency. Investments in digital capabilities are yielding tangible results, with online sales benefiting from strong traffic growth across both the website and mobile app. Enhancements such as mobile payment solutions, pharmacy pre-payment options and in-store automation initiatives are streamlining the shopping and complementing the company’s integrated omnichannel approach.
Costco’s growth trajectory remains supported by a disciplined expansion strategy. The company continues to add new warehouse locations in high-potential markets while maintaining a measured pace that supports productivity and returns. For fiscal 2026, the company expects to open 28 net new warehouses and is targeting 30-plus warehouse openings annually over the longer term. With plans to accelerate new openings in the coming years, this steady expansion, combined with strong membership growth, positions Costco well to sustain long-term revenue and earnings momentum.
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Costco Holds Ground Amid Intensifying Competition
Costco's impressive sales figures come at a time when competition across retail is intensifying. Rivals such as Ross Stores, Inc. ROST, Dollar General Corporation DG and Target Corporation TGT are expanding product assortments, improving supply-chain efficiency, and enhancing both in-store and digital experiences to capture greater market share. These retailers are also sharpening their value propositions through competitive pricing, private-label expansion and targeted promotions.
Despite these pressures, Costco continues to hold its ground through its membership-driven model, strong customer loyalty and value-focused pricing strategy. Its bulk purchasing power and efficient operations help maintain a competitive edge, while steady traffic trends and solid comparable sales growth indicate that consumers continue to favor Costco in a challenging retail environment.
Still, margins remain an area to watch, particularly amid concerns surrounding deleverage in selling, general and administrative expenses. Foreign exchange volatility and potential tariffs on key imports also add uncertainty to the broader outlook.
How Attractive Is Costco for Value Investors?
Costco stock has gained 15.9% year to date compared with the industry’s rise of 11.6%. A sneak peek into key retail peers' performance reveals that shares of Dollar General have fallen 21.2% during the said time frame, while Ross Stores and Target have climbed 19.1% and 21.2%, respectively. Zacks Investment Research
Image Source: Zacks Investment Research
But has the rally left the Costco stock too expensive from a value-investing standpoint?
The stock is trading at a significant premium to its peers. Costco's forward 12-month price-to-earnings ratio stands at 45.93, higher than the industry’s ratio of 32.36 and the S&P 500's 22.16. Costco is trading at a premium to Target (with a forward 12-month P/E ratio of 14.54), Ross Stores (28.54) and Dollar General (14.00). Zacks Investment Research
Image Source: Zacks Investment Research
While the elevated valuation may limit upside for traditional value investors seeking inexpensive stocks, Costco’s premium reflects its consistent execution, resilient membership-driven business model and strong long-term growth profile. The key question for investors is whether the company’s operational strength and stability justify paying a higher multiple in the current environment.
How Consensus Estimates Stack Up for Costco
The Zacks Consensus Estimate for Costco’s current financial-year sales and earnings per share implies year-over-year growth of 8.9% and 13%, respectively. For the next fiscal year, the consensus estimate indicates a 7.6% rise in sales and 10.2% growth in earnings. Zacks Investment Research
Image Source: Zacks Investment Research
How to Play Costco: Buy, Hold or Sell?
Given Costco’s strong sales momentum, loyal membership base, resilient traffic trends and long-term growth drivers, the company remains a high-quality retail name with solid fundamentals. However, the stock’s premium valuation suggests that much of this strength is already reflected in the price. Current investors may consider holding their positions, as Costco’s business model continues to support steady growth, while new investors may be better served waiting for a more attractive entry point before buying.
Costco currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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Target Corporation (TGT) : Free Stock Analysis Report
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Costco Wholesale Corporation (COST) : Free Stock Analysis Report
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This article originally published on Zacks Investment Research (zacks.com).
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- Amazon offering a new 30-minute delivery space
May 12, 2026
Amazon (AMZN) is launching 30-minute deliveries throughout US cities as part of its Prime Now service, with plans to make this available in most areas 24 hours a day.
Yahoo Finance Tech Editor Dan Howley discusses this new service and what it means for the broader express delivery space, especially as more companies employ the use of delivery robots.
Video Transcript
00:00 Speaker A
Amazon is getting even faster launching 30-minute delivery services across several American cities. and yet another push by the company into express deliveries as competition heats up there. Dan Halley's been following the story. It's interesting as competition heats up, but it's not necessarily a space that Amazon has been playing as much in. Like, I think of like some of the grocery delivery services, right? Of of the world. But like Amazon hasn't really been playing in the ultra short-term space.
00:36 Dan
Well, they have their three-hour delivery, their one-hour delivery, you know, uh and this is now 30-minute delivery with Amazon now, which I it's a wild idea. And you know, one of the uh one of the uh uh ways in which they said it could be used is if you're getting ready to go to the airport and you like, you know, need a pair of AirPods or something like that. It's like, oh, that actually does kind of make sense. Yeah. Um or if you have a party coming up, maybe you need something like delivered.
01:06 Speaker A
You got something. I mean, are they charging for
01:09 Dan
So yeah, so for for No, it's not. Uh Prime members will pay $3.99 per order. Uh non-prime members will pay $13.99. Uh and then for small like tiny orders, you're going to pay an extra $1.99 for prime members and $3.99 for non-prime members. So there is there is a charge. It's also not in every city just yet. It's in uh Atlanta, Dallas, Fort Worth, Philly, Seattle, uh then Austin, Denver, Orlando, Phoenix, that's uh plans to explain there.
01:42 Speaker A
No New York.
01:43 Dan
Not on there. No, I did not see that in their release. So, I mean, it's they're they're what they're doing is they're making smaller kind of fulfillment centers throughout spaces to try to, you know, make it easier to get these items. Um and I guess, you know, we'll see if it comes to New York, that would be great.
02:02 Speaker A
I mean, in New York, there's more choices of like, I can go to the bodega and get it. Yes, it's right around the corner. It's easier than in a lot of other cities to get that that thing. Yes.
02:13 Dan
I'll toss out there though, sometimes there's stuff that you can't get at the bodega that you've got to get at like a Target or something that like you know, I you know, there's a Target they just opened in Queens, but like, you know, at least by me in Queens, it's, you know, a little hard to to get to and a little annoying. The subway doesn't always run.
02:30 Speaker A
Um, why are they doing this, Dan? Why do they want like I think of it as the courier market, right? Like why do they want to be in this market?
02:38 Dan
A lot of it is to make sure that they stay ahead of or, you know, keep pace or stay ahead of Walmart. That's I mean, it's their biggest competition in the space. Obviously, Walmart has their own speedy delivery services. And I think it's just, you know, the the quicker you can get people to turn around and buy more and more and more, the less they're going to go and look at something like a Walmart or something like a Target, for instance. Uh, you know, they have this 30-minute delivery. Uh again, I don't know what I'm going to be ordering that I need immediately, but you know, those ideas were were pretty good. Um and I think I'm always that person who like, I'll have people over and then I'll be like, oh god, I don't have food. Yeah yeah. What do I do? Um but they also have drone delivery services which, you know, I don't know how that's going to work in a city like New York. Uh I imagine people throwing rocks at it.
03:26 Speaker A
So where would that be?
03:26 Dan
Uh, there's uh uh I believe in Texas they have it. Um I I have to look up. I forget entirely where it was, but uh it's uh their drone delivery service. Uh Walmart uh also uh has one that they're they're trying and then, you know, but you got to imagine, I mean, I grew up in Jersey, right? I I uh talked with Josh Liton about this. That's either getting rocks thrown at it or it's getting shot down. I mean, I just don't think like, you know,
03:59 Speaker A
I don't know. Well, you have the other the other robot delivery server robot serve robotics has the has the driving ones and there there's been some that have tried to attack those, but no but it hasn't been that wide spread. They there's enough that that it works. Oh yeah.
04:22 Dan
Yeah, I mean, but then I think like, okay, well we have Porch Pirates that just follow around regular Amazon drivers and it's like, you know, okay, well now I got this now they don't even have to follow a car, they can just follow this drone. So I feel like it's it's just seems as though it doesn't to me doesn't make as much sense. Plus I don't need like, you know, uh, I don't know, a new remote, you know, from my TV delivered via drone. Just, you know, like I'll wait a week to get it or something like that. So it's it's just one of those things for me where I feel like it doesn't necessarily make the most sense. The 30-minute delivery and us it sold they sold me on it when they were like before the airport trip.
05:07 Speaker A
Yeah yeah yeah.
05:08 Dan
That I was okay with. And the hour, you know, but it is yeah, they I think it's mostly about uh keeping pace and and you know, running past Walmart and getting people
05:16 Speaker A
I got it. Yes.
05:22 Dan
you're going to make a purchase so much faster and so much off the cuff if you can say, okay, I'm going to get it right now versus, okay, I'm going to get it in a day or I'm going to get it in a day or two, which by the way, still insane to get something in a day.
05:37 Speaker A
Yeah, I mean and I've uh I've just just anecdotally, my own interactions with Amazon Prime, um when you buy something, they offer to send you groceries. like, do you want to add groceries? And it's not just whole foods that they're pulling from. They're they seem to be pulling from both their own grocery now and other local stores, which is an interesting development over the past six months or so.
06:06 Dan
Yeah, and I've I've honestly done the kind of uh uh like last second. Someone mentioned uh uh talking about like a game that we my friends and I play. Uh and they brought it up and I was like, oh, maybe I should buy that. Uh let's see. And then I just pulled up Amazon and it's like, get it tomorrow. And I was like, well, if I can get it tomorrow, why wouldn't I? And I think that's really kind of the idea. That impulse buy. If you can get it so fast, you're just going to say, oh yeah. Yeah.
06:33 Speaker A
Yes.
06:35 Dan
Cause it's true there are times when I
06:36 Speaker A
ve looked on and it's going to take longer and I just say,
06:39 Dan
Oh, exactly. Yes, yes, yes. I will I'll buy like paper towels through Amazon. I want to have two huge boxes of paper towels, not because I'm hoarding, but because I like to know that I got it there. You know, you feel rich when you got like two things of paper towels. Those things are expensive. That's, you know, that's crazy. So I I like to I like to get, you know, that but if they're going to say it'll be here in two weeks, I'm like, oh I'll just take the one.
07:05 Speaker A
Exactly.
07:09 Dan
All right, Dan, thank you so much.
07:12 Speaker A
I love paper towels guys.
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- Costco & 3 Retail Stocks Set to Beat Wall Street This Earnings Season
May 12, 2026
As investors gear up for the next wave of earnings releases, results from major Retail-Wholesale players could shape near-term market sentiment. This reporting cycle should offer a better insight into both demand and margin trends. Performance is likely to have hinged on consumer sentiment, cautious discretionary spending, and retailers’ ability to manage promotional intensity and cost pressures against a challenging macro backdrop.
According to the latest Zacks Earnings Preview, the sector is expected to deliver revenue growth of 8.6% year over year for the ongoing earnings season, following a 7% increase in the preceding season. Earnings are expected to rise 1.6% this season, a notable deceleration from 6.5% growth recorded in the previous reporting cycle. The numbers suggest that while sales momentum remains healthy, the slowdown in earnings growth signals margin pressure.
As earnings season nears its conclusion, investor focus is increasingly shifting toward companies with high earnings-beat probability and resilient business models. We have identified four stocks — Casey's General Stores, Inc. CASY, Lowe's Companies, Inc. LOW, Target Corporation TGT and Costco Wholesale Corporation COST — that appear well-positioned to surpass earnings expectations this season.
Key Factors Likely to Have Influenced Retail Earnings
The retail earnings season is likely to reflect a consumer environment that remained resilient on the surface but increasingly selective underneath. Value-oriented retailers and scaled omnichannel operators may have benefited from steady employment, still-positive wage growth and consumers’ continued preference for convenience and competitive prices. Discount chains, warehouse clubs and omnichannel players appear well-positioned, benefiting from persistent trade-down behavior as consumers prioritize essentials and value-oriented purchases.
At the same time, the earnings season is expected to highlight widening performance dispersion across the sector. Higher-income consumers are likely to have remained relatively stable spenders, supporting categories such as beauty, travel-linked retail and premium essentials. However, middle and lower-income households probably continued to face pressure from elevated borrowing costs, tighter credit conditions and lingering inflation. This environment may have contributed to cautious purchasing behavior, smaller basket sizes and promotional activity across several retail categories.
Inventory management and operational efficiency are also expected to have emerged as major differentiators. Investments in automation, AI-enabled demand forecasting, merchandising optimization and logistics efficiency may have provided incremental support to operating margins. Retailers leveraging data analytics and supply-chain technology are likely to have benefited from improved inventory turns and lower fulfillment costs.
Another defining factor during the earnings season was the evolving tariff and supply-chain landscape. Retailers with diversified sourcing networks, strong private-label penetration and sophisticated inventory planning systems are likely better positioned to absorb higher import costs and mitigate sourcing disruptions. Companies with robust loyalty ecosystems, membership programs and integrated physical-digital capabilities may have continued to gain market share.
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4 Retail Stocks Poised for Earnings Surprises
Our research shows that for stocks with the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold), the chance of a positive earnings surprise is as high as 70%. You can see the complete list of today’s Zacks #1 Rank stocks here.
Casey's: Zacks Rank #2 + Earnings ESP of +1.02%
Casey’s continues to distinguish itself through a unique business model that successfully integrates high-margin prepared foods with a resilient fuel and grocery operation. The company is leveraging its differentiated position as a leading pizza provider to drive customer frequency and capture market share, even as traditional restaurant competitors face mounting price pressure. Strategic initiatives, such as the expansion of the "Casey’s Rewards" program and the calculated rollout of new culinary platforms like chicken wings, are effectively deepening guest loyalty and creating incremental sales occasions. The successful integration of the Fikes acquisition and a robust pipeline for new store builds underscores a disciplined approach to geographic expansion and operational efficiency.
Casey’s has a Zacks Rank #2 and an Earnings ESP of +1.02%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
The Zacks Consensus Estimate for fourth-quarter fiscal 2026 earnings per share has risen by 14 cents to $3.44 over the past 30 days, implying an increase of 30.8% from the year-ago period. The consensus estimate for revenues stands at $4.33 billion, which indicates a year-over-year jump of 8.4%. CASY has a trailing four-quarter earnings surprise of 20%, on average.
Casey's General Stores, Inc. Price, Consensus and EPS SurpriseCasey's General Stores, Inc. Price, Consensus and EPS Surprise
Casey's General Stores, Inc. price-consensus-eps-surprise-chart | Casey's General Stores, Inc. Quote
Lowe's: Zacks Rank #2 + Earnings ESP of +0.57%
Lowe's has demonstrated resilient financial performance through a disciplined execution of its Total Home strategy, successfully gaining market share despite a complex macroeconomic backdrop. The company is aggressively expanding its footprint with professional customers by integrating high-growth acquisitions like Foundation Building Materials and Artisan Design Group. Innovation remains a core competitive advantage, evidenced by the rollout of AI-enabled sales tools and a robust omnichannel platform. These strategic initiatives are bolstered by a "perpetual productivity improvement" culture that optimizes operational efficiency and ensures consistent value for a diverse customer base.
Investors can count on Lowe's with a Zacks Rank #2 and an Earnings ESP of +0.57%. The Zacks Consensus Estimate for first-quarter fiscal 2026 earnings per share has been stable at $2.96 over the past 30 days, suggesting an increase of 1.4% year over year. The consensus estimate for revenues is pinned at $22.91 billion, which indicates growth of 9.5% from the year-ago period. LOW has a trailing four-quarter earnings surprise of 2.1%, on average. The company will report numbers on May 20, before the opening bell.
Lowe's Companies, Inc. Price, Consensus and EPS SurpriseLowe's Companies, Inc. Price, Consensus and EPS Surprise
Lowe's Companies, Inc. price-consensus-eps-surprise-chart | Lowe's Companies, Inc. Quote
Target: Zacks Rank #3 + Earnings ESP of +2.35%
Target is revitalizing its market position by leaning into its unique identity as a design-led, style-forward retailer. The company is driving growth through a multi-category assortment strategy that infuses newness into high-potential areas like beauty, wellness and "Fun101," while reclaiming its authority in the home category with an overhaul of its most popular brands. Strategic investments are being funneled into an integrated digital and loyalty ecosystem, highlighted by the rapid expansion of the same-day delivery service and a membership program. Operational efficiency is also being bolstered by leveraging AI for personalized guest experiences and streamlining supply-chain processes to support both physical store performance and digital fulfillment.
Target has a Zacks Rank #3 and an Earnings ESP of +2.35%. The Zacks Consensus Estimate for first-quarter fiscal 2026 earnings per share has been stable at $1.34 over the past 30 days, calling for an increase of 3.1% year over year. The consensus estimate for revenues stands at $24.28 billion, which indicates an increase of 1.8% from the year-ago period. The company will report numbers on May 20, before the opening bell.
Target Corporation Price, Consensus and EPS SurpriseTarget Corporation Price, Consensus and EPS Surprise
Target Corporation price-consensus-eps-surprise-chart | Target Corporation Quote
Costco: Zacks Rank #3 + Earnings ESP of +1.02%
Costco continues to reinforce its position as one of the strongest operators in global retail through its powerful value-driven business model, resilient membership ecosystem and disciplined execution. The company is benefiting from strong traffic trends, accelerating digital engagement and continued momentum in high-growth categories such as pharmacy, fresh foods and private-label offerings, while its Kirkland Signature brand remains a major competitive advantage. Management’s ongoing investments in warehouse expansion, AI-enabled personalization, operational efficiency and supply-chain flexibility further strengthen Costco’s long-term growth profile and enhance the member experience. The company’s ability to lower prices selectively, maintain high renewal rates and drive consistent market-share gains underscores the durability of its model, even in a dynamic consumer and tariff-driven environment.
Costco has a Zacks Rank #3 and an Earnings ESP of +1.02%. The Zacks Consensus Estimate for third-quarter fiscal 2026 earnings per share has risen by three cents to $4.91 over the past seven days, implying an increase of 14.7% from the year-ago period. The consensus estimate for revenues stands at $69.36 billion, which indicates a year-over-year rise of 9.7%. COST has a trailing four-quarter earnings surprise of 1.1%, on average. The company will report numbers on May 28, after the market closes.
Costco Wholesale Corporation Price, Consensus and EPS SurpriseCostco Wholesale Corporation Price, Consensus and EPS Surprise
Costco Wholesale Corporation price-consensus-eps-surprise-chart | Costco Wholesale Corporation Quote
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- These 2 U.S. retail companies are most likely to beat consensus in Q1: Bernstien
May 12, 2026
Investing.com -- Bernstein named two U.S. retailers it believes are most likely to beat Wall Street consensus estimates in the first quarter, in a note on Tuesday, though the bank cautioned that the outlook for the rest of the year may matter more to investors than the headline results.
Five Below and Target are the names in question.
Analyst Zhihan Ma said the quarter is shaping up as "one of bifurcating fates," with retailers catering to higher-income consumers set to benefit from stimulus momentum, while fuel pressures, general inflation and reductions in food-stamp transfers are likely to weigh on discounters serving lower-income shoppers, including Dollar General, Dollar Tree and Walmart.
Bernstein believes Five Below and Target are best positioned to beat estimates, with Costco carrying an outside chance given fuel inflation headwinds.
The bank noted, however, that those beats are already well-telegraphed by recent credit card data, and that margins will be a key swing factor.
For both Five Below and Target, Bernstein stated that investor attention will fall on how management guides for the remainder of the year, warning that executives must strike a careful balance to avoid an investor reaction that could cause them to "sell the news."
On Walmart, Bernstein continues to like the retailer given strong market share momentum and improving profitability, but noted that expectations are high at current valuations.
Ma prefers Dollar General over Dollar Tree in the discount space, describing Dollar General as a "self-help story that's less predicated on the macro environment."
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