Retail giant Target (NYSE:TGT) announced it is temporarily closing hundreds of its stores amid widespread rioting and looting. While the shuttering of some of its locations may impact revenue in the near term, nothing is suggesting that Target’s stock will take a nosedive soon.
Target announced Saturday that it is temporarily shutting down operations in 175 stores and shortening the hours in about 25 of its locations across the U.S. The announcement came as rioters looted several Target stores at the height of the protests ignited by the death of George Floyd.
Looters ransacked the Target store on Lake Street in Minneapolis, the location nearest the epicenter of the protests. Images and videos of the store being pillaged circulated on social media platforms over the weekend.
In a press statement, the big-box retailer said ,
We are heartbroken by the death of George Floyd and the pain it is causing communities across the country. At this time, we have made the decision to close a number of our stores.
The company temporarily shuttered 70 stores in Minnesota, 49 in California, and 12 in New York . Target also closed some of its locations in Texas, Illinois, Colorado, Oregon, Georgia, Missouri, Michigan, and Pennsylvania.
Target’s stock has made an impressive recovery after the pandemic-induced crash in March. Even with the recent closures, we can expect the stock to continue its bullish tone.
Target’s stock is up over 35% from the March low of $90.17. The retail titan has weathered the economic fallout of the pandemic as the company’s digital sales soared.
As consumers stayed home in adherence to shelter-in-place orders, Target saw its digital comparable sales grow 141% in the first quarter . April was the company’s strongest month in the e-commerce arena, as digital sales skyrocketed 282%.
Chief executive Brian Cornell said:
On an average day in April, our [digital] operations were fulfilling many more items and orders than last year’s Cyber Monday.
The massive growth in the company’s e-commerce sector could minimize the impact of non-performing stores amid the protests.
Also, Target operates 1,871 stores in the United States. The number of closed locations represent about 10% of the company’s vast retail footprint across the country.
The stock remains in a long-term uptrend. Even amid closures, nothing suggests the stock will go down in flames anytime soon.