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Target raises quarterly dividend to $1.12 per share

EditorAhmed Abdulazez Abdulkadir
Published 2024/06/12, 14:10

MINNEAPOLIS - Target Corporation (NYSE: NYSE:TGT) has announced an increase in its quarterly dividend to $1.12 per common share, marking a 1.8% rise from the previous dividend of $1.10. The new dividend is scheduled for payment on September 10 to shareholders who are on record as of August 21. This upcoming dividend represents Target's 228th in a row, dating back to its initial public offering in October 1967.

This incremental rise continues Target's long-standing tradition of annual dividend increases, setting 2024 to become the 53rd successive year of such growth. Target, a mainstay of American retail, operates close to 2,000 stores and maintains a robust online presence through Target.com. The company has a history of community engagement, contributing 5% of its profit to local communities weekly, a practice it has upheld since 1946.

The dividend increase comes as part of Target's commitment to providing value to its shareholders and maintaining a consistent dividend policy. This decision reflects the board's confidence in the financial strength and the long-term growth potential of the company.

As a retailer with a broad consumer base, Target has been a significant player in the industry for decades. The company's ability to sustain a progressive dividend over such an extended period is indicative of its operational stability and sound financial management.

This announcement is based on a press release statement from Target Corporation.

In other recent news, Target Corporation (TGT) reported mixed first quarter results, with a 3.7% decline in comparable sales but a 39% revenue increase compared to 2019, reaching over $24.5 billion.

Despite missing the anticipated earnings per share (EPS) of $2.20 with a reported EPS of $2.03, Deutsche Bank (ETR:DBKGn) continues to recommend a Buy rating for Target, albeit with a reduced price target from $209 to $190. The bank attributes the shortfall to higher-than-expected selling, general, and administrative expenses, partly due to costs associated with the relaunch of Target Circle.

In a bid to enhance market share and competitive edge, retailers including Target, Walgreens, and Walmart (NYSE:WMT) have announced price reductions on essential items like food, a move that could potentially impact the inflated profits seen during the pandemic era.

These recent developments are in line with the Federal Reserve's expectations of declining inflation, with the personal consumption expenditures (PCE) price index anticipated to show a consistent 2.7% annual increase in April.

Target's growth strategy includes significant store expansion and investment in its loyalty program, Target Circle. The company also plans to introduce new merchandise and value through price reductions on numerous everyday items.

InvestingPro Insights

Target Corporation's (NYSE: TGT) recent dividend increase is a testament to its financial resilience and commitment to shareholder returns. With a market capitalization of $67.63 billion, Target is a heavyweight in the retail sector. Notably, the company's P/E ratio stands at a modest 16.35, suggesting that its shares could be trading at an attractive price relative to its earnings. This is further supported by the company's PEG ratio of 0.31 over the last twelve months as of Q1 2025, indicating potential for earnings growth compared to its P/E ratio.

InvestingPro Tips highlight Target's impressive track record of raising its dividend for 53 consecutive years, underscoring the company's reliable income for investors. Additionally, 14 analysts have revised their earnings estimates upwards for the upcoming period, reflecting a positive outlook on the company's financial performance. For investors looking for more detailed analysis and additional tips, there are 9 more InvestingPro Tips available for Target Corporation at InvestingPro.

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Target's ability to maintain its dividend payments over an extended period is a strong indicator of its financial health and prudent capital management. As the company prepares for its next earnings date on August 14, 2024, investors will be keen to see if Target can continue its legacy of consistent shareholder value amidst the dynamic retail landscape.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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