Goldman analysts, led by Kate McShane, note that the ongoing social media-driven boycott continues to pressure Target’s traffic and sales. McShane maintains a “Neutral” rating on the stock—downgraded from “Buy” in April—as consumer perception of the woke retailer has yet to recover.
McShane and her team analyzed X activity, sentiment, app downloads, and in-store foot traffic trends to gauge where Target stands in the current boycott cycle—and their findings suggest a continuation:
“Looking at historical trends, transactions appear to be the lowest 3-6 months following the call for a boycott, and we would note that NPS and NPI at TGT appear to be improving. That said, in our view, it is still too early to call a turnaround given the difficult macro backdrop for discretionary categories.”
Negative sentiment on social media persists into June…
Walmart enjoys stronger consumer favorability than Target—likely because it’s less woke, but also a result of offering the most competitive prices for budget-conscious shoppers (separate GS note here).
Net favorability is even deteriorating among Democratic consumers…
App downloads in May fell 17.2% year-over-year, and monthly active users also declined.
Traffic trends showed improvement from February lows but deteriorated again in June…
However, Target’s Net Promoter Scores and Net Purchase Intent on a trailing 3-month basis have reached lows on the year and could be followed by improvement, according to the analysts.
McShane traces the roots of the current boycott back to 2023 (read here), noting that in both the 2016 and 2023 boycotts, Target experienced negative transaction growth and delayed recoveries. She adds that the current boycott is following a similar trajectory.
McShane’s overview of the retailer:
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The boycott has weighed on Target’s traffic and brand perception.
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Improvement is possible but will require a macro tailwind, recovery in discretionary spending, and inventory adjustments.
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Despite weakness, acknowledges upside potential if sentiment improves or SG&A is better managed.
McShane maintains a “Neutral” rating on Target with a 12-month price target of $90.
The nationwide boycott of Target over Pride merchandise for children is widely viewed as part of America’s broader culture war. Many consumers are fed up with woke, globalist corporations pushing far-left political agendas, and they’re increasingly realizing they can protest with their pocketbooks.
We took a stroll with @SarahPPerry through a Target store to see the extent of their “pride” merchandise.
What we found is that @Target is very much in the business of promoting gender confusion and grooming children.
The verdict: avoid shopping at Target. pic.twitter.com/qGnkyFM3gK
— Heritage Foundation (@Heritage) May 25, 2023
Target has new Pride collection. What this corporation is doing is far worse than anything Bud Light did. They are targeting children and selling chest binders and “tuck-friendly” bathing suits for children. pic.twitter.com/1koW3N6mkZ
— I Meme Therefore I Am 🇺🇸 (@ImMeme0) May 16, 2023
This kind of consumer pushback is only gaining momentum, forcing mega corps to choose between listening to their customer base or facing backlash and boycotts on X. In response, a parallel economy is emerging…
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