It’s the end of Target as we know it ... but the big winner this week is energy
Wesfarmers (ASX:WES) announced the closure or conversion of up to 167 of Target’s 289 stores on Friday morning, with 92 of these stores becoming Kmart locations.
IBIS World reports that Target has underperformed Kmart over the past five years, with the brand’s sales declining significantly after a brief boost in February and March 2020 due to consumer stockpiling activity.
The $44 billion capped Wesfarmers holds an estimated market share of 45% in the Department Stores industry, with revenue attributable to the Kmart Group (which includes Kmart and Target) expected to increase at an annualised 0.4% over the five years through 2019-20, to approximately $8.1 billion. Most of this growth has stemmed from Kmart, which exhibited sales growth of 1.5% in 2018-19, while sales revenue for Target declined by the same amount.
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