Bucking A Trend

It is deeply satisfying to be proven right when everyone says one is wrong. Target, the brick-and-mortar retailer, finds itself in that enviable position. Contrary to conventional wisdom that retail is on the way out in an era of e-commerce, Target’s CEO spent “$7 billion to remodel 600 stores, open new small-format stores and grow its private label brands.”  Wall Street hated the idea. Target’s same-store sales grew by a hefty 3 percent compared to a 1.3 percent decline in the previous year. The retailer is back and healthy compared to struggling companies such as Sears and JC Penney. Doubling down is a risky strategy but it is working for Target. From an investor relations perspective, there wasn’t much to say until the company proved its approach. Stock analysts are tough to persuade without numerical evidence. It must be interesting to listen in to the quarterly analyst calls.