Target Corporation operates as a general merchandise retailer in the United States and Canada, offering offering a selection of merchandise, including consumables, seasonal, home products and apparel. The company was founded in 1902 and is based in Minneapolis, Minnesota.
TGT Price Forecast Based on DCF Valuation
DCF Fair Value Target:
The table below illustrates the output of a discounted cash flow forecast using a variety of scenarios for Target Corp. To summarize, we found that Target Corp ranked in the 72th percentile in terms of potential gain offered. More precisely, our analysis suggests the stock is undervalued by approximately 256% on a DCF basis. The most interesting components of our discounted cash flow analysis for Target Corp ended up being:
In the past 5.79 years, Target Corp has a compound free cash flow growth rate of 0.34%; that's better than 86.9% of cash flow producing equities in the Consumer Defensive sector, where it is classified.
TGT's estimated cost of debt, based largely on its market capitalization and its interest coverage ratio, is 2%; for context, that number is higher than 26.28% of tickers in our DCF set.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
ABEV, FMX, ANDE, SPTN, and GNC can be thought of as valuation peers to TGT, in the sense that they are in the Consumer Defensive sector and have a similar price forecast based on DCF valuation.