Walmart Stole Target’s Entire Identity… And Now Only One Thing Can Save Them

There was a time not long ago when shopping at Target meant something. It meant you had taste. You walked into those bright red doors and instantly felt like you were better than the average grocery store dweller. Your cart wasn’t just filled with bananas and toothpaste… it had throw pillows, seasonal candles, and a Magnolia-branded spatula that looked like Chip and Joanna Gaines personally handed it to you while sipping on iced oat milk lattes.

Target was retail’s cool older cousin. The one who had a great job, perfect skin, a beach house in Miami, and could rock a linen jumpsuit without looking like a cult leader. Walmart on the other hand was your dad in cargo shorts asking where the fishing lures are and yelling “it’s cheaper online” at a cashier.

But then something weird happened. Walmart looked across the aisle, clocked Target’s whole “bougie on a budget” aesthetic and decided to go full Zuckerberg. They copied everything. The layout. The influencer-ready product lines. The curated endcaps that scream “Instagram me.” And unlike most knockoffs, they didn’t screw it up. Walmart went from being the place where you grab motor oil and beef jerky to somewhere you could genuinely buy a ceramic plant pot and a pack of edamame and not feel weird about it.

The horror for Target is that people actually started buying it. A lot of it. For instance, Walmart posted a 4.5% increase in U.S. same-store sales last quarter. But, over in Minneapolis, Target’s earnings looked like a sad playlist on loop. Comparable sales fell 3.8%... twice as bad as analysts expected. In-store traffic dropped 2.4%, and even the people still showing up are spending less, with the average transaction size dipping 1.4%. That’s a tough combo (might be time to put Chip and Joanna Gaine’s face on the logo).

CEO Brian Cornell tried to put on a brave face, but when you only gained or held market share in 15 out of 35 categories, the message is clear: you’re getting outplayed. Target’s once-loyal shoppers are drifting, and a lot of them are drifting to Walmart.

Behind the scenes, it’s been a mess of cost pressures and culture wars. Tariffs on imports from China are hitting Target hard. About 30% of its private label stuff still comes from China (down from 60% a few years ago) but it’s still enough to hurt. Then came the DEI fallout. Target scaled back its diversity and inclusion efforts earlier this year, and it blew up in their face. Civil rights leaders like Al Sharpton called them out, and on the other side, the customers who had boycotted them… didn’t exactly come running back. They tried to walk a middle line, and instead, just got run over from both directions.

But in my opinion, the real problem might just be the identity crisis. Target built its brand on being affordable and stylish. It was the only place you could buy string lights, a swimsuit, and an overpriced charcuterie board setup and somehow feel like you were walking out of a boutique. That used to mean something. But now, you can go to Walmart and get a similar feeling for cheaper (even if everyone inside wears pajamas).

To try to fix it, Target launched a brand new “Enterprise Acceleration Office.” I’ll admit, it sounds like a job title your friend made up to impress his girlfriend’s parents. But it’s real. And it’s run by COO Michael Fiddelke, who now oversees an effort to simplify operations, integrate more tech, and do something (anything) to get the company back on track. So at least they’re making an effort.

But no matter how many buzzwords they come up with, the optics aren’t improving. Target’s gross margin slid to 28.2%, EPS missed badly at $1.30 (analysts were expecting $1.65), and the company had to trash its full-year outlook. They're now projecting earnings somewhere between $7 and $9 a share… down from their previous high-end forecast of $9.80.

That said, as much as Target’s been taking hits lately, there’s still a spark there. Honestly, if they sold a chunk of equity to Chip and Joanna, painted “Magnolia” on the front of the building, and leaned all the way into the farmhouse fantasy... it would print money and Walmart wouldn’t be able to copy it. You know it and I know it.

PS: It’s a mess out there.

One day the market’s ripping, the next day it’s Black Monday all over again. Recent earning’s reports have been a total coin flip. One stock beats and explodes 30%… the next misses by a penny and gets sent to the Shadow Realm. And through it all, everyone’s begging for Jerome Powell to finally cave and cut rates.

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We’re seeing violent price action. Especially in the small-cap space, where low floats and high anxiety are creating the perfect recipe for 100%+ pops before lunchtime. Some of these names are moving 200%+ in under 24 hours… and to our knowledge, NO ONE else is covering them.

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Stock.News does not have positions in companies mentioned.