Target Corporation operates as a general merchandise retailer in the United States. The company offers apparel for women, men, boys, girls, toddlers, and infants and newborns, as well as jewelry, accessories, and shoes; and beauty and personal care, baby gear, cleaning, paper products, and pet supplies. It also provides dry grocery, dairy, frozen food, beverages, candy, snacks, deli, bakery, meat, and food service; electronics, which includes video game hardware and software, toys, entertainment, sporting goods, and luggage; and furniture, lighting, storage, kitchenware, small appliances, home decor, bed and bath, home improvement, school/office supplies, greeting cards and party supplies, and other seasonal merchandise. In addition, the company sells merchandise through periodic design and creative partnerships, and shop-in-shop experience; and in-store amenities. Further, it sells its products through its stores; and digital channels, including Target.com. Target Corporation was incorporated in 1902 and is headquartered in Minneapolis, Minnesota.

Target looks like a high-quality retailer with strong return on capital, but with notable valuation and liquidity constraints. A P/E of 17 and a P/S of 0.56 are below industry medians, which supports the idea of moderate undervaluation on earnings and revenue; however, a P/B of 4.17 is significantly above the median, suggesting an expensive book value valuation. A P/FCF around the median looks neutral and does not provide a strong case for an aggressive upward revision. Return on capital is very strong: ROE of 26.66%, ROA of 7.36%, and ROI of 14.16% are well above the industry, confirming the business’s high quality and efficient use of assets. At the same time, margins are weaker than industry benchmarks: net margin of 4.08% and operating margin of 4.49% are below the median, and their year-over-year trend does not show sustained improvement, which limits revaluation potential. Gross margin of 29.3% looks better than before, which is a positive signal, but it has not yet fully translated into operating profit. Debt burden remains above the industry level: debt/equity of 0.80 and long-term debt of $14.28 billion create valuation risk, especially against the backdrop of weak liquidity ratios. A quick ratio of 0.36 and a current ratio of 0.93 indicate tight short-term liquidity, which is an important limiting factor for a mature retailer. Dividend yield has declined to 0.75% from higher levels last year, so the dividend argument is now weaker than before. On the other hand, revenue, earnings, assets, and equity overall remain large and are growing, while net income and EPS are at a high level relative to the industry. Overall, the fundamentals support the current valuation more than they call for a meaningful increase, because strong return on capital is offset by a rich P/B, weak liquidity, and less-than-ideal margin dynamics. For an investor, this means the stock looks high quality but not cheap, and the potential for price appreciation over a one-year horizon is more moderate than pronounced.

Target Corporation

Сильный индекс, значительно упал. Оптимистичный взгляд на свои позиции резко сменился на неуверенность.

Strong index, significantly down. An optimistic view of his position suddenly changed to uncertainty.

Сильный индекс, без изменений. Медведи в растерянности.

Strong index, flat. The bears are confused.

Сильный индекс, незначительно упал. Рынок не поддерживает быков.

Strong index, slightly down. The market does not support the bulls.

Сильный индекс, незначительно вырос. Рынок на стороне медведей.

Strong index, slightly up. The market is on the bears' side.

Средний индекс, значительно упал. Отток средств из лонгов резко увеличился и находится на высоком уровне.

Medium index, significantly down. The outflow of funds from longs has increased sharply and is at a high level.

Сильный индекс, значительно вырос. Приток средств в шорты резко увеличился и находится на высоком уровне.

Strong index, significantly up. The inflow of funds into shorts has increased sharply and is at a high level.

Strong return on capital and moderately cheap P/E and P/S for TGT are offset by a high P/B, weak liquidity, and pressure on operating margins.

Key Points
After languishing, Target's shareholders have enjoyed this year's return.
The new CEO has implemented plans to boost sales.
Early results suggest the company has been executing well.
After a period of underperforming the market, Target (NYSE: TGT) shareholders have been pleased with this year's return. The stock has had a total return, including dividends, of 71% year to date through Sept. 8. That crushed the S&P 500 index's 13% return.
Nonetheless, the share price has a lot more upside potential, given Target's prospects and valuation.
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Target's sales were sluggish before this year. But Michael Fiddelke, promoted to CEO earlier this year, hit the ground running. He implemented plans that included going back to the trendier, differentiated merchandise that originally drew customers to Target. Fiddelke has also invested in store improvements and technology to improve the shopping experience.
Although it's early in the process, this year's results have shown improvement. Target's fiscal second-quarter same-store sales (comps) grew 3.8%. Notably, the increase was almost entirely driven by higher traffic, which accounted for 3.6 percentage points.
It's not discounting merchandise to boost sales, either. Excluding tariff refunds, Target's gross margin expanded about 1 percentage point to 30%. That's due to fewer markdowns and higher sales of advertising and other non-merchandise sales.
Meanwhile, despite the 66% share price gain this year, Target still has an attractive valuation. Target's price-to-earnings (P/E) ratio increased from 12 to 17 during this time. However, that's a much lower P/E multiple than the S&P 500's 26.
Additionally, shareholders can confidently collect dividends, given that Target has raised the payout for 55 straight years. That includes boosting this month's payment by 1.8% to $1.16 per share.
At the new quarterly rate, Target pays a $4.64 annualized dividend. That equates to a 2.9% dividend yield, nearly triple the S&P 500's 1.1% yield.
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Meet the Value Stock That's Crushing the S&P 500. Here's Why It's Still a Great Buy in September.

Best Buy Co., Inc. BBY raised its fiscal 2027 outlook after a better-than-expected second quarter, shifting attention to whether its improving profit model can hold through the second half. Stronger sales trends are now being reinforced by newer earnings streams.
Marketplace and Best Buy Ads are contributing to gross-margin expansion, while core categories remain supportive. Memory inflation, tougher computing comparisons and higher operating investments still limit how much of that benefit may reach the bottom line.
Best Buy Co., Inc. Price, Consensus and EPS Surprise
BBY's Guidance Raise Resets FY27 Expectations
Best Buy lifted fiscal 2027 revenue guidance to $42.3-$42.8 billion from $41.2-$42.1 billion. Adjusted earnings guidance increased to $6.70-$6.90 per share from $6.30-$6.60.
The company also raised its adjusted operating income rate forecast to 4.4-4.5% from 4.3-4.4%. Comparable sales are now expected to increase 1.9-3%, versus the prior range of a 1% decline to 1% growth.
Best Buy's Margin Story Leans on New Profit Streams
Domestic gross margin expanded 60 basis points to 24% in the second quarter. The improvement reflected Marketplace, Best Buy Ads and about $34 million of tariff refunds, partly offset by lower product margin rates.
Management expects the fiscal 2027 gross profit rate to improve about 30-40 basis points, led by Ads and Marketplace. The outlook assumes similar tariff refunds in the third quarter.
BBY's Marketplace and Ads Businesses Are Scaling
Domestic Marketplace gross merchandise value reached about $300 million in the second quarter. Best Buy raised its full-year Marketplace expectation to $1.3 billion after stronger-than-anticipated performance.
Best Buy Ads is expected to grow 10% in fiscal 2027 after roughly $900 million in collections last year. Walmart Inc. WMT reported 38% global advertising growth and more than 50% marketplace net sales growth in its latest quarter. Target Corporation TGT said non-merchandise sales rose more than 20%, reflecting strength in Roundel, Target Circle 360 and Target+.
Best Buy's Core Categories Support the Higher Outlook
Computing, home theater and emerging categories were the largest weighted contributors to domestic comparable sales growth. Computing recorded its 10th consecutive quarter of positive comparable sales growth, while domestic TV sales rose more than 10%.
Management expects phones, TVs and emerging categories to grow in the second half. Major appliances also returned to slight sales growth, although the recovery still depends on pricing, availability, delivery speed and installation.
BBY Still Has Cost and Comparison Risks
Industry-wide memory cost increases are raising computing prices. Computing average selling prices rose in the mid-teens in the second quarter while unit volumes fell in the high single digits, showing demand sensitivity to higher price points.
Computing growth is expected to slow as Best Buy laps two years of gains and a particularly strong prior-year third quarter. Annual adjusted SG&A is planned to increase about 20 basis points, which could absorb part of the gross-margin benefit.
BBY's Hold Signal Tempers the Upbeat Outlook
The bottom line is that Best Buy has raised the earnings bar as new profit streams scale and core category trends improve. The second-half test is whether Ads and Marketplace can keep supporting profitability while computing and operating costs become less favorable.
BBY currently carries a Zacks Rank #3 (Hold). It also has a Value Score of A, Growth Score of A, Momentum Score of A and VGM Score of A. Those favorable Style Scores reflect attractive characteristics across several investing styles, but they complement the Zacks Rank. With a Hold rank, the combined signal supports a measured near-term view. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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BBY Raises FY27 Outlook as Ads and Marketplace Lift Profitability

Looking today at week-over-week shares outstanding changes among the universe of ETFs covered at ETF Channel, one standout is the State Street Consumer Staples Select Sector SPDR ETF (Symbol: XLP) where we have detected an approximate $324.1 million dollar inflow -- that's a 2.3% increase week over week in outstanding units (from 169,771,809 to 173,671,809). Among the largest underlying components of XLP, in trading today Target Corp (Symbol: TGT) is off about 0.1%, Colgate-Palmolive Co. (Symbol: CL) is down about 0.1%, and Mondelez International Inc (Symbol: MDLZ) is lower by about 0.1%. For a complete list of holdings, visit the XLP Holdings page » The chart below shows the one year price performance of XLP, versus its 200 day moving average:
Looking at the chart above, XLP's low point in its 52 week range is $75.16 per share, with $90.14 as the 52 week high point — that compares with a last trade of $83.36. Comparing the most recent share price to the 200 day moving average can also be a useful technical analysis technique -- learn more about the 200 day moving average ».
Exchange traded funds (ETFs) trade just like stocks, but instead of ''shares'' investors are actually buying and selling ''units''. These ''units'' can be traded back and forth just like stocks, but can also be created or destroyed to accommodate investor demand. Each week we monitor the week-over-week change in shares outstanding data, to keep a lookout for those ETFs experiencing notable inflows (many new units created) or outflows (many old units destroyed). Creation of new units will mean the underlying holdings of the ETF need to be purchased, while destruction of units involves selling underlying holdings, so large flows can also impact the individual components held within ETFs.
Further XLP Research:

Noteworthy ETF Inflows: XLP, TGT, CL, MDLZ

Best Buy Co., Inc. BBY has a stronger earnings setup, but investors must weigh that improvement against a valuation above its historical norm. Higher guidance, positive estimate revisions and stronger cash generation support further progress.
Memory-cost inflation, promotion-sensitive consumers and a forward multiple above its five-year median keep the risk-reward balance from becoming one-sided. Better fundamentals now have to justify a higher price.
Best Buy Co., Inc. Price, Consensus and EPS Surprise
BBY's Earnings Picture Is Improving
The Zacks Consensus Estimate for fiscal 2027 earnings is $6.79 per share, above $6.43 in fiscal 2026. The fiscal 2027 earnings estimate has moved 3.8% higher over the past four weeks.
BBY's latest quarterly earnings surprise was 7.3%. That result adds to recent estimate momentum and strengthens the case that the earnings trajectory is improving.
Best Buy's Higher Guidance Raises the Earnings Bar
Best Buy raised fiscal 2027 revenue guidance to $42.3-$42.8 billion and adjusted earnings guidance to $6.70-$6.90 per share. Comparable sales are now expected to increase 1.9-3%, versus the prior outlook ranging from a 1% decline to 1% growth.
The higher outlook reflects first-half performance and momentum entering the second half. It also raises the execution bar because expectations for the fiscal year have improved.
BBY's Valuation Now Sits Above Its Five-Year Median
BBY trades at 12.5X forward 12-month earnings, above its five-year median of 11.5X. The multiple remains within its five-year range of 7.0X to 15.5X, but the stock is no longer below its historical midpoint.
The PEG ratio stands at 2.10. Continued earnings and margin progress could support the multiple, but a setback would leave less valuation cushion.
Best Buy Still Faces Demand and Margin Risks
Industry-wide memory cost increases are lifting computing prices. In the second quarter, computing average selling prices rose in the mid-teens while unit volumes fell in the high single digits, showing sensitivity to higher price points.
Consumers remain value-focused and attracted to sales events, while appliance improvement still requires pricing and service investments. The annual adjusted SG&A rate is planned to increase about 20 basis points, which could limit margin upside.
Target Corporation TGT reported 3.8% second-quarter comparable sales growth and said it had lowered prices on more than 10,000 frequently purchased items over the past year. That emphasis on value reinforces the promotional backdrop across retail.
Walmart Inc. WMT reported 23% global e-commerce growth in its latest quarter and highlighted price, speed and convenience as customer priorities. Its continued price investments underscore the competitive standard for omnichannel retailers.
BBY's Cash Flow and Yield Add Defensive Support
Best Buy generated $1.30 billion of operating cash flow in the first half, up from $783 million a year earlier. Cash and cash equivalents reached $2.26 billion at quarter-end compared with $1.46 billion a year ago.
BBY's dividend yield is about 4.4%, while the company continues to expect approximately $300 million of fiscal 2027 share repurchases. That cash return profile adds support as the operating recovery develops.
BBY's Hold Signal Balances Strong Style Scores
The bottom line is that BBY's earnings outlook has improved, but the valuation no longer offers the same historical discount. Better estimates, higher guidance and cash flow support the shares, while memory inflation and a higher multiple argue for a measured entry stance.
The stock currently carries a Zacks Rank #3 (Hold). BBY also has a Value Score of A, a Growth Score of A, a Momentum Score of A and a VGM Score of A. Those favorable grades complement rather than override the Zacks Rank, supporting a balanced near-term view instead of an outright buy signal. You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.
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Is BBY a Buy as Growth Improves but Valuation Climbs Above Its Median?

Shares of Best Buy Co., Inc. BBY have gained 17.9% in the past three months, raising the bar for further upside. The advance now has better operating support, with earnings, revenues and comparable sales improving in the latest quarter. Broader category growth and higher fiscal 2027 guidance strengthen the case for sustained momentum. Memory-cost inflation, tougher computing comparisons and a valuation above recent norms keep the investment picture balanced.
Best Buy Co., Inc. Price, Consensus and EPS Surprise
BBY's Three-Month Rally Meets Stronger Fundamentals
Second-quarter adjusted earnings rose 15% to $1.47 per share and beat the Zacks Consensus Estimate of $1.37. Revenues increased 3.6% to $9.78 billion and topped the consensus mark of $9.56 billion, while enterprise comparable sales advanced 4.1%.
Best Buy raised fiscal 2027 revenue guidance to $42.3-$42.8 billion and adjusted earnings guidance to $6.70-$6.90 per share. Comparable sales are now expected to increase 1.9-3%, up from the prior range of a 1% decline to 1% growth.
Best Buy's Q2 Beat Adds Weight to the Momentum
Domestic comparable sales rose 4.5%, while domestic online comparable sales increased 5.1%. The domestic gross profit rate expanded 60 basis points to 24%, helped by Marketplace, Best Buy Ads and about $34 million of tariff refunds, partly offset by lower product margin rates.
Online revenues represented 33.1% of domestic revenues, up from 32.8% a year earlier. That mix reinforces Best Buy's omnichannel traction as Marketplace and Best Buy Ads scale alongside retail operations.
BBY's Growth Mix Is Broadening Beyond Computing
Computing delivered its 10th consecutive quarter of positive comparable sales growth, while mobile phones posted a sixth straight quarter of growth. Home theater also strengthened, with domestic TV sales rising more than 10% year over year.
Combined sales of AI glasses, trading cards and health rings more than doubled from a year earlier and contributed about one percentage point to comparable sales growth. Best Buy Business sales also increased 21%, adding another growth source.
Best Buy Faces Memory Inflation and Tougher Comps
Computing average selling prices increased in the mid-teens as unit volumes fell in the high single digits. Higher memory costs are flowing into the assortment, creating elasticity risk even as Best Buy uses promotions, financing, trade-ins and earlier inventory purchases to preserve key price points.
Management expects computing growth to slow in the second half as comparisons get tougher. Traditional gaming also declined as Best Buy lapped the prior-year Switch 2 launch, underscoring the category's exposure to uneven product cycles.
BBY's Valuation Leaves Less Room for Disappointment
BBY trades at 12.5X forward 12-month consensus EPS estimate, above its five-year median of 11.5X and slightly above the Zacks sub-industry's 12.3X. That premium leaves less valuation cushion if second-half sales or margin progress falls short.
Target Corporation TGT, one of BBY's retail peers, trades at 14.9X forward earnings. Walmart Inc. WMT, another peer, trades at 36.8X. Those comparisons place BBY below both peers on this measure, even as its own multiple sits above its five-year median.
BBY's Hold Signal Meets Strong Style Scores
The bottom line is that BBY's rally has broader fundamental support, but the recent move already reflects some of that progress. Memory inflation, tougher comparisons and a higher-than-median valuation argue for a measured view of additional upside.
The stock currently carries a Zacks Rank #3 (Hold). BBY also has a Value Score of A, Growth Score of A, Momentum Score of A and VGM Score of A. Those scores indicate favorable characteristics across multiple investing styles, but they complement rather than override the Zacks Rank, supporting a balanced near-term stance. You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.
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From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
This company targets millennial and Gen Z audiences, generating nearly $1 billion in revenue last quarter alone. A recent pullback makes now an ideal time to jump aboard. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.
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Can BBY Sustain Its 17.9% Three-Month Rally as Growth Drivers Broaden?

Walmart Inc. WMT shares have lost 14.3% over the past six months, reflecting a notable cooling in investor sentiment toward the retail giant. The decline is slightly narrower than the industry’s 15% drop, but Walmart has sharply lagged the Zacks Retail – Wholesale sector’s 0.5% dip and the S&P 500’s 12.2% advance over the same period.
The divergence is striking because Walmart’s operating performance remains solid, with continued market share gains and strong digital growth. The pullback appears to reflect a combination of near-term cost and consumer concerns, softer U.S. comparable sales growth and a still-demanding valuation rather than a breakdown in the company’s long-term growth story.
Walmart has also lagged several prominent retail peers over the past three months. Shares of Target Corporation TGT have rallied 34.6 during the period, while Costco Wholesale Corporation COST and Dollar General Corporation DG have declined 10.2% and 9.5%, respectively.
What Is Weighing on Walmart Stock?
Despite Walmart’s resilient operating performance, several factors appear to be weighing on investor sentiment. A key concern is the increasingly challenging consumer backdrop. Management noted that shoppers, particularly those facing tighter household budgets, are making more deliberate spending choices amid elevated fuel costs and broader affordability pressures.
Walmart has responded by stepping up price investments and expanding rollbacks across categories. While this reinforces the company’s value positioning and can support market share gains over time, aggressive pricing can pressure near-term margins before higher volumes fully offset the investment. Management itself noted that the benefits from lower prices can take time to materialize.
Another drag is the health and wellness business, where regulatory changes have created considerable top-line pressure. Pharmacy deflation and brand-to-generic transfers associated with maximum fair price regulation have weighed on Walmart U.S. comparable sales. At the same time, the sales benefit from GLP-1 drugs has moderated from previous years. Management emphasized that these issues are largely affecting reported sales growth rather than undermining the underlying profitability or long-term attractiveness of the health and wellness business.
Cost pressures are another issue. Higher fuel expenses, depreciation tied to elevated capital spending, healthcare costs and self-insurance expenses are limiting operating leverage. Walmart is also reinvesting tariff refunds into lower prices and customer experience, which should strengthen its competitive position but may temper near-term profit growth. These factors, combined with a softer consumer environment, could explain why investors remain cautious despite Walmart’s otherwise healthy business momentum.
Walmart’s Estimate Revisions Signal Near-Term Caution
The Zacks Consensus Estimate for Walmart’s current- and next-fiscal-year EPS has moved lower over the past 30 days. The negative revision trend indicates increasing analyst caution around the near-term earnings trajectory and could restrict meaningful multiple expansion until estimates stabilize or begin moving upward.
Walmart’s Growth Engines Remain Powerful
Despite the near-term concerns, Walmart continues to possess several durable growth drivers that support its longer-term investment case. Its core retail business remains healthy, aided by a strong value proposition, broad assortment and increasing convenience. Walmart continues to gain market share across categories and income groups, including higher-income households. Underlying U.S. sales trends outside health and wellness have remained relatively steady, indicating that regulatory-driven pharmacy weakness does not necessarily reflect deterioration across the broader retail business.
Walmart’s rapidly expanding digital ecosystem remains one of its most important growth avenues. E-commerce continues to post strong growth across Walmart U.S., Sam’s Club and international markets, supported by store-fulfilled delivery and faster fulfillment. The company’s extensive physical store network gives it a significant last-mile advantage, enabling Walmart to combine low prices with increasingly rapid delivery. Higher delivery density, automation and improved fulfillment efficiency are also helping enhance the economics of the digital business.
Walmart is becoming less dependent on traditional retail margins as higher-margin businesses scale. Advertising, marketplace, membership and fulfillment services are becoming increasingly important contributors to growth and profitability. Management indicated that these newer businesses are already accounting for a meaningful portion of profit growth, supporting a structurally better earnings mix.
International expansion provides another avenue for growth as Walmart increasingly deploys its marketplace, membership and digital capabilities across markets. Investments in automation, technology and supply-chain infrastructure should further improve productivity and customer experience. Together, these initiatives strengthen Walmart’s ability to grow sales, deepen customer engagement and expand profitability over the long run.
WMT’s Premium Valuation Reflects Quality
WMT currently trades at a P/E multiple of 34.25, above the industry’s 31.33 and its five-year median of 24.9. The premium appears to reflect Walmart’s defensive business model, consistent market-share gains, expanding digital capabilities and improving contribution from higher-margin businesses such as advertising, marketplace and membership.
Walmart’s multiple is also substantially above Target and Dollar General, which trade at forward P/E multiples of 15.94 and 15.47, respectively. Costco, on the other hand, carries an even richer multiple of 40.01.
The valuation does not necessarily look excessive for a business with Walmart’s scale and consistency, but it does suggest that investors continue to assign meaningful value to successful execution of its growth strategy.
Image Source: Zacks Investment Research
WMT Stock Calls for a Balanced Approach
Walmart’s recent pullback has improved the stock’s entry point, while its long-term growth prospects remain supported by e-commerce, advertising, marketplace, membership and international expansion. Its strong value proposition should also aid continued market share gains.
However, pharmacy deflation, consumer pressure, elevated costs, ongoing price investments and downward earnings-estimate revisions warrant some caution. Given these near-term uncertainties and WMT’s still-premium valuation, a neutral stance appears appropriate. Existing investors may consider holding the stock, while prospective buyers may wait for a more attractive valuation or improving earnings estimate trends.
Walmart currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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This article originally published on Zacks Investment Research (zacks.com).

Should You Buy Walmart Stock After a 14% Decline in Six Months?

Macy’s, Inc. M reported second-quarter fiscal 2026 results, with earnings and revenues surpassed the Zacks Consensus Estimate. Both metrics increased from the year-ago quarter.
The company’s Bold New Chapter strategy continued to gain traction, with positive comparable-sales growth across Macy’s, Bloomingdale’s and Bluemercury. Bloomingdale’s posted a second consecutive quarter of double-digit comparable-sales growth, while the Reimagine 200 Macy’s locations maintained their outperformance.
However, Macy’s shares fell 4.7% yesterday despite the quarterly earnings and revenue beat and the higher full-year outlook. The market reaction indicates that investors may have focused on the projected third-quarter loss, the expected sequential moderation in comparable sales and the company’s decision to reinvest most of the tariff-refund benefit to support longer-term growth.
Macy's, Inc. Price, Consensus and EPS Surprise
More on Macy’s Q2 Results
Adjusted earnings, excluding the net tariff-refund benefit, were 40 cents per share, topping the Zacks Consensus Estimate of 37 cents and increasing from 35 cents in the year-ago quarter. Macy’s reported GAAP earnings of 62 cents per share and adjusted earnings of 63 cents per share, with both figures including a 23-cent net benefit from tariff refunds after reinvestment.
Net sales of $4,866 million surpassed the Zacks Consensus Estimate of $4,820 million and increased 1.1% year over year. Excluding the impact of fiscal 2025 store closures, net sales grew 1.9%. Total revenues advanced 1.2% to $5,059 million from $4,999 million in the prior-year quarter.
Comparable sales rose 2.7% on an owned-plus-licensed-plus-marketplace basis, marking the company’s fifth consecutive quarter of comparable-sales growth. Go-forward business comps, including go-forward locations and digital across the three nameplates, increased 2.8%.
Other revenues increased 3.2% to $193 million. Credit card net revenues grew 2% to $156 million, aided by a healthy credit portfolio and stable net credit card losses. Macy’s Media Network revenues advanced 8.8% to $37 million, reflecting higher partner engagement on the advertising platform.
Update on M’s Brand Performance
Comparable sales at the Macy’s nameplate increased 1.1% year over year, representing the fifth consecutive quarterly gain. Reimagine 200 locations posted comparable-sales growth of 1.9%, with increases in nine of the past 10 quarters. These stores account for nearly 60% of the go-forward Macy’s fleet and about 75% of go-forward store sales.
At Macy’s, strength in watches, dresses, petites, career sportswear, kids, handbags, fragrances and men’s and women’s shoes was partly offset by softness in plus sizes, intimates and women’s sleepwear. Big-ticket trends improved sequentially but remained below the prior-year level. Digital comps were also positive, supported by improved assortments and marketplace growth.
Bloomingdale’s comparable sales jumped 11.3%, marking the brand’s second consecutive quarter of double-digit growth and its highest second-quarter sales volume in 154 years. Growth was broad-based across channels, markets and categories, with notable strength in ready-to-wear, men’s apparel, fine jewelry, fragrances and tabletop.
Bluemercury comps increased 6.2%, driven by its Summer Party marketing campaign and demand for dermatological skincare, makeup and fragrances. New and remodeled stores continued to perform well during the quarter.
Insight Into Macy’s Margins & Expenses
The gross margin rate expanded 180 basis points to 41.5%, which beat our estimate of 39.8%. The quarter included a 180-basis-point benefit from net tariff refunds, partly offset by a 10-basis-point headwind from ongoing tariff and fuel costs. Excluding both effects, the underlying gross margin rate improved about 10 basis points, reflecting favorable brand mix and benefits from the Reimagine expansion, partly offset by channel mix.
Selling, general and administrative (SG&A) expenses increased 0.8% to $1.96 billion. The rise reflected higher variable costs tied to sales growth and continued investments in Bold New Chapter initiatives, partly offset by cost-management efforts. As a percentage of total revenues, the SG&A rate improved 20 basis points to 38.7%. We estimated SG&A expenses to increase 1% year over year in the second quarter of fiscal 2026.
Adjusted EBITDA increased 22.5% to $457 million from $373 million in the prior-year period. The adjusted EBITDA margin expanded 150 basis points to 9% of total revenues.
M’s Financial Snapshot: Cash, Inventory & Equity Overview
Macy’s ended the quarter with cash and cash equivalents of $1.29 billion, up from $829 million a year ago, with total debt of $2.43 billion. The company had $2 billion of available borrowing capacity under its asset-based credit facility and no material long-term debt maturities until 2030.
Merchandise inventories increased 2.5% year over year, broadly in line with comparable-sales growth. Management said inventory was well-positioned for the fall season, with a balanced mix of newness and evergreen merchandise.
For the first half of fiscal 2026, operating cash flow was an inflow of $586 million compared with $255 million in the year-ago period. Free cash flow was $262 million versus an outflow of $88 million a year earlier. Capital expenditures totaled $324 million.
During the second quarter, Macy’s returned $101 million to shareholders through $51 million in dividends and $50 million in share repurchases. The company bought back 2.2 million shares during the quarter and had about $1 billion remaining under its $2-billion authorization.
Macy’s Q3’26 Outlook
For the third quarter of fiscal 2026, this Zacks Rank #2 (Buy) company expects net sales of $4.65-$4.70 billion. Fiscal 2025 store closures contributed approximately $30 million to sales in the comparable prior-year period. Comparable sales are projected to range from a 0.5% decline to a 0.5% growth on an owned-plus-licensed-plus-marketplace basis.
The adjusted EBITDA margin is expected to be between 3.7% and 4%. The adjusted loss per share is forecast between 19 cents and 23 cents. The outlook incorporates a portion of the planned second-half reinvestment of tariff refunds and a tougher comparable-sales comparison against 3.2% growth in the prior-year quarter.
Sneak-Peek Into Macy’s FY’26 Guidance
Following the second-quarter beat, Macy’s raised its fiscal 2026 outlook. The company expects net sales of $21.675-$21.825 billion, up from the previously stated $21.5-$21.75 billion. The guidance continues to reflect the impact of fiscal 2025 store closures, which contributed approximately $145 million to prior-year sales.
Comparable sales are projected to increase 1-1.5%, above the earlier forecast of 0.5-1.2% growth. Other revenues are still expected to be $920 million. The gross margin rate is anticipated to be between 38.5% and 38.7%, while SG&A expenses are expected to increase 1.5-2.25% on a dollar basis.
The adjusted EBITDA margin is forecast at 7.8-8%, up from 7.7-7.9%. Adjusted earnings are projected at $2.15-$2.35 per share compared with the prior range of $2-$2.20. The outlook does not incorporate the effect of potential future share repurchases.
Macy’s expects full-year capital expenditures of $800-$825 million. The company anticipates a combined tariff and fuel gross-margin headwind of 5-15 basis points, narrower than the previously expected 20-30 basis points. Of the $116 million in tariff refunds received, management expects roughly $20 million or about 5 cents per share, to flow to full-year earnings, with the balance supporting brand building, selective value investments and additional Reimagine pilots.
Macy's Stock Past Three-Month Performance
Shares of this company have lost 19.2% over the past three months compared with the industry’s 4.7% decline.
Other Stocks to Consider
We have highlighted three other top-ranked stocks in the retail space, namely Kohl’s Corporation KSS, Target Corporation TGT and Ross Stores Inc. ROST.
Kohl’s is a United States based department store retailer. The company offers moderately priced apparel, footwear and accessories for women, men and children, along with beauty and home products. It flaunts a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Kohl’s current fiscal-year earnings and sales indicates growth of 17.3% and decline of 0.8%, respectively, from the year-ago actuals. KSS delivered a trailing four-quarter average earnings surprise of 84.8%.
Target offers guests fashionable, differentiated merchandise and everyday essentials at discounted prices. It currently carries a Zacks Rank of 2.
The Zacks Consensus Estimate for Target's current fiscal-year earnings and sales suggests growth of 37.8% and 4.7%, respectively, from the year-ago actuals. TGT delivered a trailing four-quarter average earnings surprise of 10.5%.
Ross Stores operates as an off-price retailer of apparel and home accessories, primarily in the United States. The company also holds a Zacks Rank #2 at present.
The Zacks Consensus Estimate for Ross Stores’ current fiscal-year earnings and sales indicates growth of 32.7% and 12.4%, respectively, from the year-ago actuals. ROST delivered a trailing four-quarter average earnings surprise of 11.2%.
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Macy's, Inc. (M) : Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).

Macy's Stock Down 5% Despite Q2 Earnings Beat, FY'26 View Raised

Casey’s General Stores, Inc. CASY posted first-quarter fiscal 2027 earnings of $7.37 per share, which increased 27.7% year over year and surpassed the Zacks Consensus Estimate of $6.60 by 11.7%. Revenues rose 24.3% to $5,678.3 million, beating the $5,624 million consensus mark by 1%.
Higher inside and fuel gross profit supported the quarter, partly offset by increased operating expenses. Inside same-store sales rose 3.2%, while fuel same-store gallons slipped 0.3%.
CASY's Inside Sales Gain on Prepared Food Demand
Total inside sales increased 5.6% year over year to $1,777.5 million. Prepared food and dispensed beverage same-store sales advanced 4.8%, driven mainly by positive traffic led by whole pizzas. Grocery and general merchandise same-store sales increased 2.7%, helped by non-alcoholic beverages.
Inside gross profit rose 6.3% to $749.8 million, while inside margin expanded about 30 basis points to 42.2%. Prepared food and dispensed beverage margin improved to 59.3% from 58%, reflecting favorable mix and cost-of-goods management, while grocery and general merchandise margin eased to 35.6% from 35.9%.
Casey's General Stores, Inc. Price, Consensus and EPS Surprise
Casey's General Stores, Inc. price-consensus-eps-surprise-chart | Casey's General Stores, Inc. Quote
Casey's Fuel Profit Climbs on Margin Strength
Total fuel gallons sold increased 2.5% to 934.2 million gallons as a larger store base more than offset the modest same-store decline. Fuel gross profit climbed 19.6% to $446.9 million.
Fuel margin, excluding credit card fees, widened to 47.8 cents per gallon from 41 cents a year earlier. Management said its fuel capabilities helped the company navigate a volatile environment and produce strong results during the quarter.
CASY's Costs Rise as Store Base Expands
Operating expenses increased 8% to $754.1 million. Operating 64 more stores than a year earlier accounted for about 2% of the increase, while higher same-store credit card fees added roughly 1.5%.
Same-store employee expense contributed about 1% of the increase, primarily because of higher labor rates, while labor hours were nearly flat. Insurance accounted for another roughly 1% of the increase.
Casey's Earnings Growth Outpaces Expense Increase
Net income advanced 27.1% year over year to $273.7 million. EBITDA increased 17.1% to $485.1 million as higher inside and fuel gross profit outweighed part of the cost pressure.
Cash provided by operating activities totaled $384.1 million compared with $372.4 million a year ago. Casey’s spent $194.4 million on property and equipment and ended July with about $1.4 billion of available liquidity, including $524.1 million in cash and cash equivalents.
CASY Expands Store Base and Returns Cash
Casey’s ended the quarter with 2,959 stores, up from 2,944 at the start of the fiscal year. The company added nine newly constructed stores and 12 acquired locations while closing or divesting six stores.
The company repurchased about $45.6 million of shares during the quarter and had approximately $973 million remaining under its authorization. The board also approved a quarterly dividend of 65 cents per share, payable on Nov. 13, 2026.
Casey's Keeps Fiscal 2027 Outlook Unchanged
For fiscal 2027, Casey’s continues to expect inside same-store sales growth of 2%-5%, with inside margin above 42%. Same-store fuel gallons are projected to range from down 1% to up 1%, while operating expenses are expected to increase 5%-7%.
The company continues to target EBITDA growth of 8%-10% and plans to open at least 120 stores through acquisitions and new construction. Casey’s also expects about $800 million of capital spending and roughly $95 million of net interest expense.
CASY's Three-Year Plan Adds a Longer Growth Runway
Casey’s new three-year plan calls for at least 400 additional stores during fiscal 2027 through fiscal 2029 through a mix of new builds and acquisitions. The investor plan also targets roughly $2 billion of free cash flow over the period and continued inside-store margin expansion.
The strategy pairs unit growth with operating-efficiency initiatives intended to keep operating-expense growth below EBITDA growth. Identified workstreams include store simplification, supply-chain efficiency, kitchen optimization, centralized procurement and a scalable support model as the store network expands.
Shares of this Zacks Rank #3 (Hold) company have fallen 19.9% over the past three months compared with the industry’s decline of 17.2%.
Stocks to Consider
The Vita Coco Company, Inc. COCO, a leading beverage company that develops, markets and distributes coconut water and other plant-based beverages, currently sports a Zacks Rank #1 (Strong Buy). COCO delivered a trailing four-quarter earnings surprise of 21.9%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for The Vita Coco Company’s current fiscal-year sales and earnings per share (EPS) calls for growth of 31.6% and 64.7%, respectively, from the year-ago figures.
Target Corporation TGT, a general merchandise retailer, currently carries a Zacks Rank of 2 (Buy). TGT delivered a trailing four-quarter earnings surprise of 10.5%, on average.
The Zacks Consensus Estimate for Target’s current fiscal-year sales and EPS implies growth of 4.7% and 37.8%, respectively, from the year-ago figures.
Laird Superfood, Inc. LSF is a consumer product company that develops, manufactures and markets plant-based, natural and functional food and beverage products. LSF currently carries a Zacks Rank #2.
The Zacks Consensus Estimate for Laird Superfood’s current fiscal-year sales and EPS suggests growth of 188.2% and 104%, respectively, from the year-ago figures. LSF delivered an earnings surprise of 100% in the last reported quarter.
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This company targets millennial and Gen Z audiences, generating nearly $1 billion in revenue last quarter alone. A recent pullback makes now an ideal time to jump aboard. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.
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This article originally published on Zacks Investment Research (zacks.com).

CASY Q1 Earnings Beat Estimates on Inside and Fuel Gains

e.l.f. Beauty, Inc. ELF is expanding its presence across international markets through broader retail distribution, deeper penetration in key countries and new brand launches. The international business was a standout in the first quarter of fiscal 2027, with international net sales rising 61% year over year compared with 29% growth in the United States. International penetration has also doubled over the past five years and now represents 21% of total net sales.
The growth comes alongside broader brand expansion across established and newer markets. In the core e.l.f. brand, trends improved meaningfully in both the United Kingdom and Germany. Germany saw a major turn to very strong positive growth following the brand’s introduction at DM, after earlier comparisons were affected by the large ROSSMANN launch. In the UK, performance improved after a period marked by heavy promotional activity and the restart of awareness-building and marketing efforts. e.l.f. is also set to expand its presence at Boots in the fall.
The international push extends beyond the core brand. Naturium, which launched with Sephora in Australia and New Zealand last October, has reached the No. 1 ranking in body at Sephora in those markets and is scheduled to enter Sephora in Canada and Mexico this fall. rhode has posted record-setting launches with Sephora in North America and the UK and with Mecca in Australia and New Zealand, reaching the No. 1 beauty-brand ranking at both retailers.
e.l.f. Beauty is also expanding into Brazil through Sephora this fall, building on its No. 1 cosmetics-brand ranking with Sephora in Mexico. Together, these developments reflect broader retail and geographic expansion across e.l.f., Naturium and rhode.
e.l.f. Beauty’s Zacks Rank & Share Price Performance
Shares of this Zacks Rank #3 (Hold) company have gained 87.3% over the past three months, outperforming both the industry and the S&P 500, which increased 27.1% and 3.5%, respectively. The stock also outperformed the broader Consumer Staples sector, which gained 2.1% during the same period.
ELF Stock's Past Three Months Performance
Is e.l.f. Beauty a Value Play Stock?
e.l.f. Beauty currently trades at a forward 12-month P/E ratio of 28.17, which is up from the industry average of 23.73 and the sector average of 17.02. This valuation positions the stock at a premium compared with its industry peers and the broader sector.
ELF P/E Ratio (Forward 12 Months)
Stocks to Consider
Five Below, Inc. FIVE operates as a specialty value retailer in the United States and currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Five Below’s current fiscal-year sales and earnings calls for growth of 18.4% and 49.2%, respectively, from the year-ago reported numbers. FIVE delivered a trailing four-quarter earnings surprise of 68.3%, on average.
Dollar Tree Inc. DLTR is an operator of discount variety stores offering a broad assortment of everyday consumables and discretionary merchandise. The company currently carries a Zacks Rank #2 (Buy). DLTR delivered a trailing four-quarter earnings surprise of 12.2%, on average.
The Zacks Consensus Estimate for Dollar Tree’s current fiscal-year sales and earnings indicates growth of 6.7% and 32.2%, respectively, from the year-ago reported numbers.
Target Corporation TGT operates as a general merchandise retailer in the United States. It currently carries a Zacks Rank of 2. TGT delivered a trailing four-quarter average earnings surprise of 10.5%.
The Zacks Consensus Estimate for Target’s current fiscal-year sales and earnings indicates growth of 4.7% and 37.8%, respectively, from the year-ago actuals.
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From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
This company targets millennial and Gen Z audiences, generating nearly $1 billion in revenue last quarter alone. A recent pullback makes now an ideal time to jump aboard. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.
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This article originally published on Zacks Investment Research (zacks.com).

e.l.f. Beauty's International Sales Jump 61%: What's Driving It?

Key Points
Realty Income and Home Depot are performing well despite a challenging real estate climate.
Coca-Cola and Procter & Gamble are both Dividend Kings and own beloved brands.
Target looks like it's starting to recover, but the stock is still cheap.
Between artificial intelligence (AI) momentum, a strong U.S. consumer, high inflation, and an on-and-off war with Iran, there are plenty of ways the market could go. For now, it's still in growth mode and up 13% year-to-date. However, the threat of a market pullback remains in the background, and it could happen in any form, whether dip, correction, or crash, at any time.
Investors should be prepared for all situations with a well-diversified portfolio that includes top dividend stocks. Coca-Cola (NYSE: KO), Realty Income (NYSE: O), Target (NYSE: TGT), Procter & Gamble (NYSE: PG), and Home Depot (NYSE: HD) are my top picks for September.
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1. Coca-Cola
Coca-Cola is the quintessential Dividend King (a stock that has raised its dividend payout for at least 50 years running). The iconic beverage maker has raised its dividend for 64 years consecutively, under all kinds of conditions, and the stock yields 2.4% at the current price.
It's considered a safe stock, and it doesn't always beat the market. However, it's been having a banner year, up 27% year to date, trouncing the market.
Investors are loving its resilience in the face of tough inflation and other challenges. Last year, when new tariffs were announced, it had an edge over the competition due to its localized production model. In today's high-inflation environment, loyal fans continue to buy its beloved brands, underscoring why it's been a top stock for decades.
In the second quarter, for example, revenue increased 5% year over year, while non-generally accepted accounting principles (GAAP) comparable operating Margin (Non-GAAP) increased from 30.7% to 31.9%.
2. Realty Income
Realty Income is one of the few dividend stocks that pay monthly, an attractive perk on top of its already top-notch dividend. It's the one stock on this list that yields 5.3% at the current price.
It's a real estate investment trust (REIT) and owns nearly 16,000 properties globally, making it one of the largest REITs in the world. It specializes in retail, specifically essential retail such as grocery and convenience stores, and its top tenants include 7-Eleven and Walgreens. Retail makes up almost 80% of its portfolio, but it's increasingly diversifying into other categories that expand its addressable market, including data centers.
Realty Income has paid a dividend monthly without skipping a beat for more than 56 years, and it has raised it for the past 115 quarters.
3. Target
Target's been going through some tough times, but it seems to be on the brink of a turnaround. The market was enthusiastic about its 2026 fiscal second quarter (ended Aug. 1) results, and the stock is up 68% this year. However, it still trades at only 17 times trailing 12-month earnings, implying there's more room to run.
The indications of a proper recovery on the way include a 3.8% year-over-year increase in comparable sales (comps), and more specifically, a 2.7% increase in store comps. Digital comps were up 8.7%, and they've carried the company for a while. More people coming back to stores is what the market is looking for.
Profitability is also back on the rise, and even adjusted for a tariff benefit, earnings per share (EPS) increased 20% over last year in the quarter. Even better, management raised its full-year guidance for sales growth, operating margin, and EPS.
Target is a Dividend King and has raised its dividend for the past 54 years, and it yields 2.8% at the current price.
4. Procter & Gamble
Procter & Gamble owns many of the brands you know and love in categories that include beauty, home care, and healthcare, including Crest toothpaste, Pantene shampoo, and Tide laundry detergent. It's consistently reliable for high sales, and it's constantly upgrading its products and marketing to stay dominant.
It's not a fast-growing company, but it usually manages low-single-digit increases, such as its 3% year-over-year sales increase in the 2026 fiscal fourth quarter (ended June 30) and a 2% EPS increase.
It's also a Dividend King, having raised its dividend for the past 70 years, and there is only one other company on the stock market that has a longer track record. At the current price, Procter & Gamble's dividend yields 3%.
5. Home Depot
Home Depot is the largest home improvement chain in the world, with 2,300 stores in North America. It's facing a prolonged period of challenge as the real estate market remains under pressure, but it's demonstrating strength under adversity.
In the 2026 fiscal second quarter (ended Aug. 2), sales were up 5.7% year over year, and comps were up 1.7%. It maintained its full-year guidance of a 3.5% sales increase at the midpoint, with comps up 1% at the midpoint. It's planning to open 15 stores this year, a show of resilience, but increasing comps is a positive sign that not all the growth is coming from new stores, even in the tough growth climate.
Home Depot has been paying a dividend since 1987, and although it went through periods without raising it, it has done so for the past 16 years despite several bouts of difficulty, including today. At the current price, the dividend yields 2.9%, and with the stock down 23% over the past year, Home Depot is a great buy on the dip.
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Jennifer Saibil has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Home Depot, Realty Income, and Target. The Motley Fool has a disclosure policy.
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Indicator	TTM Median
P/E	17.00 18.86
Price/Sales	0.56 0.74
P/B	4.17 1.79
P/FCF	16.76 16.26

Indicator	TTM Median
ROE	26.66 14.31
ROA	7.36 6.34
ROI	14.16 9.04
Net Worth	58.14 1.27
Quick Ratio	0.36 0.81
Current Ratio	0.93 1.31

Indicator	TTM Median
Net Profit Margin	4.08 6.17
Operating Margin	4.49 8.56
Gross Margin	29.30 33.36
Return on tangible equity	26.66 23.71

Indicator	TTM Median
EPS	2.46 0.65
EPS Forecast	2.30 0.53
Revenue	25.44B 130.50M
Gross Profit	8.94B —
EBITDA	1.95B —

Target Corporation

Recent quarterly and TTM performance

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