11:04 AM EDT, 10/02/2025 (MT Newswires) -- Target's ( TGT ) sales have likely deteriorated in the ongoing quarter amid the retailer's operational "missteps" in a challenging discretionary environment, Truist Securities said in a Thursday client note.

The brokerage now projects Target's ( TGT ) fiscal third-quarter comparable sales to decline 4%, with further downside potential as there is a full month left to the quarter. That compares with Truist's prior estimate of a 1.3% drop. The retail giant in August reported a 1.9% fall in second-quarter comparable sales.

Truist sees earnings at $1.48 per share for the third quarter, revised down from $1.69, and $6.80 for 2025, compared with a previous estimate of $7.15. The brokerage also cut EPS forecasts for 2026 and 2027.

"While the discretionary environment took a notable leg down (early 2022) following the pandemic-related retail sales surge, Target ( TGT ) has also hurt themselves with multiple missteps," Truist analysts, including Scot Ciccarelli, said in the note. "We believe these self-inflicted wounds range from inventory mismanagement, merchandising errors and marketing mistakes to, more recently, widening price gaps against competitors and deteriorating store standards."

Such factors have weighed on Target's ( TGT ) sales and earnings, Ciccarelli said.

The brokerage lowered its price target on the stock to $83 from $102, while maintaining a hold recommendation.

Target ( TGT ) will have to accelerate merchandise innovation and ramp up investment in prices to turn things around, a process that "will not be painless," according to Ciccarelli.

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