Target (NYSE: TGT) said its impressive holiday sales performance and recent share acceleration are only the beginning of a longer upward climb for the retailer, according to one Wall Street bank.
With several top-line catalysts "on tap" in 2018, Target is set to add to its 13% rally thus far this year, analyst Peter Benedict wrote to clients Wednesday.
"Key company-specific drivers include accelerated remodels, additional exclusive brand launches, and emerging convenience-oriented fulfillment options," Benedict wrote in a note.
Target has said it plans to roll out same-day delivery to half its stores by early 2018.
The analyst upgraded Target to outperform and bumped his price target to $85 from $75, implying 15% upside from Tuesday's close.
Supporting Benedict's bullish case, Target's robust holiday sales climbed 3.4%, well ahead of an expected range of 0 to 2% in an age of growing competition from e-commerce giant Amazon. The analyst also noted that Target sales surged after the 2003 Bush tax cuts, implying another wave of improved same-store sales given the recent Trump tax reform.
"Target outlined plans at last year's investor meeting to roll out twelve new exclusive brands across the company's signature categories through 2018," added Benedict.
Target shares began Wednesday up 95 cents, or 1.3%, to $74.86
