'Pride' goes before the fall of Target stock
Target’s stock has lost a whopping $13.8 billion over the past two weeks, hitting its lowest levels in nearly three years as the “cheap chic” discount retailer continues to face backlash over LGBTQ-friendly kids clothing.
Shares of the embattled chain sank 2.2% at $130.93 on Wednesday after dropping for eight straight sessions — the stock’s longest losing streak since November 2018 — giving the company a market capitalization of $60.4 billion.
That’s off 19% from two weeks earlier on May 18, when the stock was trading at $160.96 on the eve of the crisis.
It’s also the lowest levels Target shares have hit since the company was recovering from the depths of the pandemic in mid-2020.
The ongoing losses are a result of an ongoing 14-day boycott that was triggered by Target’s release of “PRIDE,” an LGBTQ-friendly line that includes clothing for children and “tuck-friendly” women’s swimwear with “extra crotch coverage.”
Wall Street is worried that Target will suffer the same fate as Anheuser-Busch, whose Bud Light sales have fallen by more than 25% since the brand tapped transgender influencer Dylan Mulvaney to promote the beer on April 1.
“Investors are concerned that Target may be experiencing a sales decline because it’s alienated some of its core customers,” said Edward Jones analyst Brian Yarbrough.
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It is pretty clear that LGBTQ marketing is a rather small niche to begin with and the blowback from it is greater than was anticipated. Apparently, any marketing study that was done on the subject was inadequate.
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