Could This Bear-Market Buy Help You Become a Millionaire?

Core Viewpoint - Target is currently experiencing a significant decline in stock value, making it a potential opportunity for long-term dividend investors despite its challenges [1][2]. Group 1: Stock Performance - Target's shares have lost over 45% of their value in the past year and about two-thirds over the last five years, indicating a bear market for the company [2]. - The company's current dividend yield has risen to approximately 5.3%, which is among the highest levels in recent history, making it attractive for dividend investors [3]. - Target is recognized as a Dividend King, having increased its annual dividends for over five decades, showcasing its resilience through economic downturns [4]. Group 2: Business Performance - In the first half of 2025, Target's revenues fell by 1.9%, and same-store sales decreased by 2.8%, reflecting poor performance compared to competitors like Walmart [5]. - Walmart's focus on low prices aligns with current consumer trends, while Target's premium brand identity is misaligned with the trade-down behavior observed in the market [6][7]. - Despite the decline, there are signs of stabilization, with a smaller second-quarter revenue drop of 0.9% and same-store sales down by 1.9%, indicating a potential improvement in performance [8]. Group 3: Investment Opportunity - The current yield presents an attractive opportunity for investors looking to build a diversified portfolio, with a sustainable payout ratio of approximately 52% over the trailing 12 months [9]. - Although risks are associated with investing in an underperforming retailer, Target's historical ability to recover suggests that management may implement necessary changes to restore performance [10].