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Target (TGT) Hikes Dividend: What Else You Should Know
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Target Corporation (TGT - Free Report) has been one of the favorite picks for investors seeking both steady income and growth. This Minneapolis, MN-based company with a strong history of dividend payments provide a hedge against any odd swings in the stock market.
This general merchandise retailer once again rewarded investors with a hike in the dividend payout. Target’s board of directors raised the quarterly dividend by 1.9% to $1.10 per share. The new dividend will be paid out on Sep 10, 2023, to its shareholders of record at the close of the business on Aug 16, 2023. Last June, Target hiked its regular quarterly dividend by 20% to $1.08.
Backed by sound fundamentals and financial strength, Target has time and again highlighted its commitment to enhancing shareholder value. We note that net cash provided by operating activities totaled $1,265 million at the end of the first quarter of fiscal 2023. The current hike marks the 52nd successive year of a dividend increase.
We believe that such strategic steps not only drive shareholder value but also raise the market value of the stock. Through these dividend increases, companies persuade investors to either buy or hold the scrip. People looking for regular income from stocks are most likely to choose companies with a track record of consistent and incremental dividend payouts.
Image Source: Zacks Investment Research
More About the Stock
Target has been undertaking several strategic endeavors — new stores, owned brand innovations, national brand partnerships, the expansion of same-day services or the rollout of sortation centers — to drive engagement, traffic and market share gains. These have been contributing to the company’s sales performance. Target witnessed stellar demand in frequency categories, such as Food & Beverage, Beauty and Household Essentials, in the first quarter of fiscal 2023.
Management intends to spend approximately $4-$5 billion in fiscal 2023 to continue scaling operations, reaching new customers as it builds capacity and enhances services and supply-chain facilities. To simplify and improve efficiencies across the business, Target has announced an enterprise-wide cost-containment effort. Through the initiative, the company plans to save between $2 billion and $3 billion over the next three years.
Target has been directing resources toward expanding digital and omnichannel capabilities. The company has been ramping up its digital solutions and strengthening delivery capabilities to make shopping more seamless. Its services like doorstep delivery, curbside pickup or buy online and pick up at store have been playing a crucial role in serving consumers better.
We note that shares of this Zacks Rank #3 (Hold) company have fallen 7.5% year to date compared with the industry’s decline of 0.2%. The stock came under pressure following Target’s soft second-quarter comparable sales guidance. Target envisions second-quarter comparable sales to decline in the low single digits. It foresees greater SG&A rate pressure in the second quarter. As a result, the operating margin rate is likely to decline on a sequential basis.
The Zacks Consensus Estimate for Kroger’s current financial-year revenues and EPS suggests growth of 2.6% and 6.9%, respectively, from the year-ago reported figure. Kroger has a trailing four-quarter earnings surprise of 9.8%, on average.
TJX Companies, which operates as an off-price apparel and home fashion retailer, carries a Zacks Rank #2. The expected EPS growth rate for three to five years is 10.5%.
The Zacks Consensus Estimate for TJX Companies’ current financial-year sales and earnings suggests growth of 6.4% and 14.5% from the year-ago period. TJX has a trailing four-quarter earnings surprise of 4.4%, on average.
Walmart, which operates a chain of hypermarkets, discount department stores and grocery stores, currently carries a Zacks Rank #2. The expected EPS growth rate for three to five years is 5.5%.
The Zacks Consensus Estimate for Walmart’s current financial-year sales suggests growth of 4.2% from the year-ago period. WMT has a trailing four-quarter earnings surprise of 12%, on average.
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Target (TGT) Hikes Dividend: What Else You Should Know
Target Corporation (TGT - Free Report) has been one of the favorite picks for investors seeking both steady income and growth. This Minneapolis, MN-based company with a strong history of dividend payments provide a hedge against any odd swings in the stock market.
This general merchandise retailer once again rewarded investors with a hike in the dividend payout. Target’s board of directors raised the quarterly dividend by 1.9% to $1.10 per share. The new dividend will be paid out on Sep 10, 2023, to its shareholders of record at the close of the business on Aug 16, 2023. Last June, Target hiked its regular quarterly dividend by 20% to $1.08.
Backed by sound fundamentals and financial strength, Target has time and again highlighted its commitment to enhancing shareholder value. We note that net cash provided by operating activities totaled $1,265 million at the end of the first quarter of fiscal 2023. The current hike marks the 52nd successive year of a dividend increase.
We believe that such strategic steps not only drive shareholder value but also raise the market value of the stock. Through these dividend increases, companies persuade investors to either buy or hold the scrip. People looking for regular income from stocks are most likely to choose companies with a track record of consistent and incremental dividend payouts.
Image Source: Zacks Investment Research
More About the Stock
Target has been undertaking several strategic endeavors — new stores, owned brand innovations, national brand partnerships, the expansion of same-day services or the rollout of sortation centers — to drive engagement, traffic and market share gains. These have been contributing to the company’s sales performance. Target witnessed stellar demand in frequency categories, such as Food & Beverage, Beauty and Household Essentials, in the first quarter of fiscal 2023.
Management intends to spend approximately $4-$5 billion in fiscal 2023 to continue scaling operations, reaching new customers as it builds capacity and enhances services and supply-chain facilities. To simplify and improve efficiencies across the business, Target has announced an enterprise-wide cost-containment effort. Through the initiative, the company plans to save between $2 billion and $3 billion over the next three years.
Target has been directing resources toward expanding digital and omnichannel capabilities. The company has been ramping up its digital solutions and strengthening delivery capabilities to make shopping more seamless. Its services like doorstep delivery, curbside pickup or buy online and pick up at store have been playing a crucial role in serving consumers better.
We note that shares of this Zacks Rank #3 (Hold) company have fallen 7.5% year to date compared with the industry’s decline of 0.2%. The stock came under pressure following Target’s soft second-quarter comparable sales guidance. Target envisions second-quarter comparable sales to decline in the low single digits. It foresees greater SG&A rate pressure in the second quarter. As a result, the operating margin rate is likely to decline on a sequential basis.
3 Stocks Looking Red Hot
Here we have highlighted three better-ranked stocks, namely Kroger (KR - Free Report) , The TJX Companies (TJX - Free Report) and Walmart (WMT - Free Report) .
Kroger, a supermarket operator, currently carries a Zacks Rank #2 (Buy). The expected EPS growth rate for three to five years is 6%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for Kroger’s current financial-year revenues and EPS suggests growth of 2.6% and 6.9%, respectively, from the year-ago reported figure. Kroger has a trailing four-quarter earnings surprise of 9.8%, on average.
TJX Companies, which operates as an off-price apparel and home fashion retailer, carries a Zacks Rank #2. The expected EPS growth rate for three to five years is 10.5%.
The Zacks Consensus Estimate for TJX Companies’ current financial-year sales and earnings suggests growth of 6.4% and 14.5% from the year-ago period. TJX has a trailing four-quarter earnings surprise of 4.4%, on average.
Walmart, which operates a chain of hypermarkets, discount department stores and grocery stores, currently carries a Zacks Rank #2. The expected EPS growth rate for three to five years is 5.5%.
The Zacks Consensus Estimate for Walmart’s current financial-year sales suggests growth of 4.2% from the year-ago period. WMT has a trailing four-quarter earnings surprise of 12%, on average.