Shares of merchandise retailer Target Corporation (TGT) have been having a surprisingly strong run on Wall Street, despite a string of challenges that might normally send investors heading for the exits. Cooling comparable sales growth, shrinking margins, and a CEO transition earlier this year have all weighed on the retailer, yet the bulls haven’t backed down. Instead, investors appear increasingly optimistic that Target’s latest turnaround efforts could finally put the retailer back on a stronger growth path.
A big part of that optimism comes from new CEO Michael Fiddelke, who took the helm in February and quickly laid out a plan to get Target moving in the right direction. His strategy focuses on remodeling stores, refreshing merchandising across apparel and home goods, improving digital and delivery speeds, and stepping up employee training. So far, the early results have given investors something to cheer about. The turnaround effort appears to be gaining traction, with Target’s same-store sales jumping 5.6% in Q1, marking the retailer’s first increase in the key metric in five quarters.
