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Target Corporation (NYSE:TGT) announced on Tuesday a deal with lifestyle brand Kendra Scott. The retailer said the strategic, long-term partnership will include an exclusive collection and a dedicated shopping experience with Kendra Scott at select Target (TGT) stores and online. The partnership will begin on October 22. Financial details were not disclosed.
Minneapolis-based Target (TGT) said the collection offers newly designed products, with prices starting as low as $15 and the majority of items priced under $40. “Target is known for democratizing style and I’m so proud of how our strategic partnership with Kendra Scott builds on that legacy of making great design accessible to all,” stated Target (TGT) Chief Merchandising Officer Jill Sando. “With over 200 items, most priced at under $40, this exclusive collection is fun, stylish, and exactly the kind of affordable joy our guests are looking for when they shop at Target,” she noted.
Target (TGT) has a long history of both launching its own brands and dedicating parts of stores to merchandise from well-recognized national names. As for the Kendra Scott business, the startup exploded after the entrepreneur inked a deal with Nordstrom (JWN) to include some of Kendra Scott’s jewelry in their stores. Kendra Scott has trended well over the last few holiday shopping periods.
On Wall Street, analysts are largely cautious on the near-term for the Target (TGT). CFRA said recently that Target’s (TGT) multi-category portfolio and reputation for offering on-trend products at affordable prices position it well to take market share over the long term, but weak consumer discretionary and various margin headwinds such as shrink, wages, and product mix kept the firm at a Hold rating. “With comp sales now in negative territory, we believe it will be difficult for TGT to return to its historical 6%+ operating margin over the next few years,” warned CFRA. While a lower percentage of shoppers have pointed to the social media backlash than just a month ago, the retailer is still expected to face various macro headwinds.
Shares of Target (TGT) are down about 5.2% over the last six weeks. The current dividend yield is 3.59%. Short interest stands at 2.2% of the total float.
