Life Musings

Smart investors know that the best time to buy stock is when other people are scared. They know that the stock market tends to do well in the long run, and so they're not fazed by price drops and fluctuations. They know that one should select one's stocks carefully, but they also know that an economic slowdown presents some great opportunities for making money.

I'd like to recommend Target (TGT) as a stock choice. Here's why I think it could pay off quite handsomely.

During an economic slowdown, people go bargain hunting. This means shopping at places like Target and Walmart-- and Target does not have the market saturation (or the questionable reputation) that Walmart does.

In addition, consider the words of Joseph Lazzaro with regard to Target stock. He says,

Target Corporation (NYSE: TGT) should post adequate FY 2009 same store sales growth, aided by refinements to its electronics, apparel, and home furnishings offerings, with a continued focus on value.

Further, 1600-store Target has handled the sector's competition well: it remains competitively-priced for comparable items with Wal-Mart Stores, Inc. (NYSE: WMT), offers an easier-access/more pleasant shopping environment than the latter, and has exhibited modest, selected pricing power, despite the U.S. economic downturn. That last point on pricing power should help TGT pass on cost increases to consumers.

In addition, Target's marketing campaigns seem to be registering better with upper-middle-income shoppers, who appear to be increasingly seeking better values. The Reuters FY 2009/FY 2010 EPS consensus estimates for TGT are $3.56 to $4.06.

I think that Target will pay off remarkably well.