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Additionally, the company employs around 52-53% of its free cash flow towards dividend payments, which is slightly above its historical average ratio of 30-50%. With over 50 consecutive years of dividend increases, Target is categorized as a Dividend King, providing a level of assurance to dividend-focused investors.
Earnings Report Highlights: Missed Expectations
The earnings report, however, raised more red flags than green. Target missed expectations on both the top and bottom lines, reporting non-GAAP earnings per share (EPS) of $1.85—significantly lower than anticipated. Revenues fell short as well, coming in at $2.67 billion, which marked a meager 1.1% increase year-over-year, yet still missed estimates by $230 million.