Target Corporation (TGT) Stock Valuation — PE Analysis
Discount Stores · NYSE
Current Price
$135.23
PE Ratio (TTM)
17.8x
Intrinsic Value
$165.65
+18.4% margin of safety
COMPETITIVE MOAT
↑Loyal Customer Base
Target's strong Q1 traffic growth indicates a resurgence in customer engagement. This loyalty is built on a consistent brand experience and curated product assortment.
↑Omnichannel Integration
Seamless integration of store and digital sales, with traffic lifting both, demonstrates effective execution of their omnichannel strategy. This convenience drives repeat business.
↑Category Strength
Gains across all six core categories highlight Target's ability to maintain relevance and appeal in diverse retail segments. This broad appeal reduces reliance on any single product area.
INVESTMENT RISKS
↓Economic Sensitivity
While S&P 500 targets are rising, broader economic shifts could still impact consumer discretionary spending. Target's performance is tied to the health of the consumer economy.
↓Competitive Pressures
The discount store industry remains highly competitive. While traffic is up, maintaining market share against other retailers requires continuous innovation and efficient operations.
↓Inventory Management
Sustaining sales growth requires careful inventory management. Unexpected shifts in demand or supply chain disruptions could lead to markdowns or stockouts.
Base case
TGT base case PE valuation
A base case PE valuation for TGT estimates a fair value of about $165.65 per share, against a current price of $135.23. The model assumes 8.7% annual earnings growth, a 18x target PE multiple, and a 10% discount rate.
Intrinsic Value
$165.65
Margin of safety
+18.4%
Expected annual return
+4.1%
Base case assumptions: 8.7% annual earnings growth, 18x target PE, 10% discount rate, 5 year projection. Data as of 2026-06-12.
This base case uses default assumptions and is not financial advice. The fair value changes significantly when the target PE or earnings growth rate changes. Open the calculator to set your own assumptions and see the full sensitivity range.
Customize the TGT PE valuation
Adjust the target PE, earnings growth, and discount rate to see how the fair value and margin of safety for Target Corporation respond.
Open PE Calculator for TGTCompany Overview
Target Corporation operates as a prominent general merchandise retailer throughout the United States. Its extensive product range includes a wide array of food items like perishables, dry groceries, dairy, and frozen goods, alongside apparel, accessories, home décor, electronics, toys, seasonal offerings, and essential beauty and household products. Beyond merchandise, Target stores often feature convenient in-store amenities such as Target Café, Target Optical, Starbucks outlets, and various other food service options. The company facilitates sales through its physical retail locations and its digital platform, Target.com. As of March 9, 2022, Target maintained a network of approximately 2,000 stores. Founded in 1902, the corporation's headquarters are situated in Minneapolis, Minnesota.
Financial Metrics — TGT PE Stock Valuation Data
PE Ratio (TTM)
17.8x
PEG Ratio
n/m
Earnings Yield
5.62%
ROE (TTM)
21.7%
Revenue/Share (TTM)
$234.41
Dividend Yield
3.37%
Debt/Equity
1.15x
Frequently Asked Questions
What is the PE ratio of TGT?
The trailing twelve-month PE ratio of TGT reflects how much investors pay per dollar of Target Corporation's earnings. This metric is most useful when compared to Discount Stores peers and the company's own historical range.
Is TGT overvalued based on PE ratio?
TGT's PE of 17.8x combined with a PEG ratio of -1.06 provides a growth-adjusted perspective. TGT has negative earnings, so its PE and PEG ratios are not meaningful here and cannot tell you whether the stock is over or undervalued. Keep in mind that PE-based valuation works best for profitable, mature companies — for high-growth or cyclical Discount Stores, a DCF analysis may be more appropriate.
How do I value TGT stock using PE ratio?
To value Target Corporation using PE: (1) Compare the current PE (17.8x) against the Discount Stores median to assess relative pricing, (2) check the PEG ratio (-1.06) to adjust for growth expectations, (3) review the 5-year PE range to identify where the stock sits historically, and (4) estimate fair value by multiplying a target PE by forward EPS estimates. This relative approach complements DCF's absolute valuation.
What is the PEG ratio of TGT?
TGT's PEG ratio is -1.06, calculated by dividing the PE ratio (17.8x) by the expected earnings growth rate. Because TGT has negative earnings, its PEG ratio is not meaningful and should not be read as a sign of under or overvaluation. Note that PEG accuracy depends on the reliability of growth estimates.
Should I use PE ratio or DCF for TGT stock valuation?
PE ratio gives a quick relative read — how TGT is priced versus Discount Stores peers. DCF provides an absolute value based on projected free cash flows. For TGT, with a strong ROE of 21.7%, both methods are worth using — PE for a market-relative check, DCF to stress-test whether fundamentals justify the price. Each method has blind spots: PE ignores capital structure and cash flow quality, while DCF is sensitive to growth and discount rate assumptions.
Learn More
- See TGT DCF Valuation → — Intrinsic value via Discounted Cash Flow analysis
- PE Methodology — Step-by-step guide to PE ratio stock valuation
- DCF Methodology — Guide to discounted cash flow analysis
- PE Ratio — Understanding the price-to-earnings ratio
- Intrinsic Value — How to evaluate stock fair value
Related PE Valuations
All Consumer Defensive valuationsP/E and DCF value TGT with different methods and assumptions, so the two conclusions can differ. Compare the DCF intrinsic value.
Price as of 2026-06-12. Financial data from Financial Modeling Prep (trailing twelve months) · Valuation methodology by Charlie Wang.
This is an estimate, not investment advice.