TGT Profit Margins
Gross, Operating & Net Margin Analysis for Target Corp
Margin Quality
Weak
Current Profit Margins
Gross Margin
27.9%
$29.27B gross profit
Operating Margin
4.9%
$5.12B operating income
Net Profit Margin
3.5%
$3.71B net income
5-Year Margin Trends
What Margins Indicate About TGT
Business Quality
Lower gross margins may reflect commodity-like products or intense price competition in the Consumer Staples.
Operational Efficiency
Expanding operating margins show Target Corp is improving operational leverage and cost management.
Profitability
Modest net margins indicate the business is profitable but may face margin pressures or be in a capital-intensive industry.
Investment Implications
Mixed margin trends require deeper analysis to understand underlying business dynamics and sustainability.
Understanding Profit Margins
Gross Margin
(Revenue - Cost of Goods Sold) / Revenue. Measures pricing power and production efficiency before operating expenses.
Operating Margin
Operating Income / Revenue. Shows profitability from core operations after all operating expenses but before interest and taxes.
Net Profit Margin
Net Income / Revenue. The bottom line - shows how much profit the company keeps from each dollar of revenue after all expenses.
Analyze TGT Profitability
Get complete financial analysis with profitability trends, ROE, ROIC, and more
Frequently Asked Questions
What is TGT's profit margin?
TGT (Target Corp) has a net profit margin of 3.5%, meaning the company keeps $0.03535980148883375 in profit for every dollar of revenue. This represents a change from the previous year's net margin of 3.8%.
What is TGT's gross margin?
TGT's gross margin is 27.9%. Gross margin measures the percentage of revenue remaining after subtracting the cost of goods sold. A lower gross margin like this reflects the competitive dynamics of the Consumer Staples.
What is TGT's operating margin?
TGT has an operating margin of 4.9%. Operating margin shows profitability after operating expenses but before interest and taxes. The 4.9% year-over-year improvement suggests better operational efficiency.
Are TGT's profit margins good?
TGT's margins are considered weak. When evaluating margins, it's important to compare against Consumer Staples Distribution & Retail peers, as different sectors have structurally different margin profiles.
How do profit margins affect TGT stock?
Profit margins are a key indicator of TGT's business quality and competitive position. The current margins should be evaluated alongside growth rates and return on capital to assess overall business quality. Expanding margins often lead to stock price appreciation, while contracting margins can signal competitive pressures.
What drives TGT's profit margins?
TGT's profit margins are influenced by several factors: pricing power vs competitors, operational efficiency, scale advantages, input costs (materials, labor), Consumer Staples Distribution & Retail-specific dynamics, and management execution. The significant expansion in gross margin suggests changes in these underlying drivers.
Disclaimer: Margin analysis is based on reported financial statements and should be compared to industry peers for context. Different sectors have structurally different margin profiles. This information is for educational purposes only and should not be considered financial advice.