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“If you could only buy one stock, which would you buy?”
A question that gives off different answers depending on who you ask, when you ask, and where you ask. Investors have given different answers to this question as their portfolio and experience grow.
Today, the S&P 500 is approaching record highs, but many independent stocks still look very promising. Many businesses struggled during the 2020 pandemic, but many are set to recover after vaccination numbers increase.
Right now, many investors are looking at Target (NYSE: TGT) as a must-buy.
Target has managed to stay in the game this long
The retail catastrophe back in 2014 hit retailers hard. Target was struggling big time to compete against Amazon (NASDAQ: AMZN), the current retail behemoth. Target’s sales were dropping hard, and its expansion to Canada had racked up significant losses.
However, thanks to the renovation of its aging stores, the launch of smaller stores for urban areas and the implementation of online orders, deliveries and in-store pick-up, Target managed to stay afloat.
Since then, it has constantly been innovating and adapting, with the launch of private-label brands, loyalty programs, price adjustments and same-day delivery options. While these implementations did not benefit the short term, they helped Target grow strong and recover to the point of blocking most of the blow from the pandemic.
Target’s rising store count
Most retailers were forced to close down stores to cut costs during the pandemic. Target did the opposite and opened 29 new stores in 2020.
Target’s rising store count helps it fulfill online orders. It is estimated that more than half of the U.S. population lives within a 10-mile drive of a Target store, which makes same-day deliveries and customer pick-up an easy task.
Analysts have confidence in Target
Analysts seem to have high hopes for Target. While they expect their revenue and earnings to fall this year, they expect it to rise 4% and 10%, respectively.
They believe it will stabilize with relative ease. Target’s stock currently trades at 21 times forward earnings and will probably grow at an alarming rate as things normalize in the world.
Target might not seem an exciting prospect for your investment at a glance. However, it’s still one of the best retailers in the U.S. The past years have been vital to Target’s growth, and it shows no sign of stopping, which is makes it an attractive buy for the long run.