Target Corp. (NYSE:TGT)

Return on Assets (ROA)

The Return on Assets shows a gradual increase beginning from a value of 7.67% in early 2020, reaching a peak of approximately 12.91% in April 2022. Following this peak, there is a notable decline to around 5.21% by October 2022. Subsequently, the ROA stabilizes with moderate fluctuations, generally maintaining a range between 6% and 8% through the early months of 2025. This suggests an initial improvement in asset efficiency which faced a downturn but later settled into a more consistent performance level.

Financial Leverage

Financial leverage started near 3.65 in mid-2019 and exhibited a gradual upward trend peaking around 5.05 in October 2022. Following this high, financial leverage decreased to roughly 3.75 by August 2025. The rising leverage indicates increasing reliance on debt financing over time until late 2022, after which there is a discernible reduction in leverage, reflecting possible strategic deleveraging or improved equity financing.

Return on Equity (ROE)

The Return on Equity demonstrates substantial variability, beginning with values around 27.73% to 28% in early 2020 and progressively climbing to reach peaks exceeding 54% in April and July of 2022. Post-peak, the ROE declines significantly to about 23.45% by July 2023. Following the drop, the metric shows moderate recovery and relative stability, oscillating between approximately 25% and 31% through mid-2025. This pattern indicates strong profitability during early 2022 with significant volatility thereafter, possibly linked to changes in financial leverage, asset utilization, or market conditions.

Overall Trends and Insights

The company’s performance metrics suggest an environment of initial growth and increasing leverage until late 2022, which coincides with peak returns on both assets and equity. The pronounced peaks in ROE relative to more moderate ROA values imply an amplified effect of financial leverage. The subsequent declines in both ROA and ROE, along with a reduction in leverage, may suggest a strategic response to mitigate financial risk or an adjustment to changing market dynamics. In the later periods, the stabilization of these ratios hints at a phase of consolidation or more conservative financial management.

The analyzed financial indicators present a multifaceted view of the company's performance over multiple quarterly periods. Key metrics such as net profit margin, asset turnover, financial leverage, and return on equity (ROE) reveal trends and variability that offer insights into operational efficiency, financial structure, and profitability.

Net Profit Margin

The net profit margin shows an initial period of growth starting in early 2020, increasing steadily from approximately 3.46% to a peak near 6.56% by early 2022. Following this peak, there is a notable decline, with margins dropping below 4% by mid-2023. Subsequent quarters display a mild recovery, stabilizing around a range slightly above 3.5%, indicating fluctuating but generally moderate profitability in recent periods.

Asset Turnover

Asset turnover ratios exhibit relative stability with minor fluctuations. Starting around 1.83 in early 2020, this metric increased modestly, peaking near 2.1 between mid-2022 and early 2023. After this peak, the ratio experiences slight decreases, settling near 1.83 by mid-2025. This pattern suggests consistent but somewhat variable asset utilization efficiency over time.

Financial Leverage

Financial leverage has generally exhibited an upward trend from 3.55 in early 2021 to a peak exceeding 5.0 in late 2022. After this peak, a downward trend ensues, with leverage ratios decreasing to approximately 3.75 by mid-2025. The rising leverage in earlier periods indicates increased reliance on debt or liabilities relative to equity, followed by a deleveraging phase in later quarters.

Return on Equity (ROE)

ROE follows a pronounced upward trajectory from roughly 27.7% in early 2020 to a high of over 54% by early 2022, reflecting significant enhancement in shareholder returns. This sharp rise correlates with both improved profit margins and increased financial leverage during the same period. Subsequently, ROE declines markedly, dropping below 25% by mid-2023, and then experiences some recovery to near 28% in the most recent quarters. The fluctuations in ROE mirror changes in profit margin, asset turnover, and leverage, showing the interplay of profitability, operational efficiency, and financial risk.

In summary, the data depict a business that experienced strong growth in profitability and shareholder returns from 2020 through early 2022, supported by increasing leverage and improving operational efficiency. However, after hitting peaks in these measures, the company faced declines in margins, leverage, and returns, with asset turnover showing more modest variance. The recent periods indicate efforts toward stabilization and moderate recovery, suggesting adjustments in financial strategy and operational management to maintain sustainable performance.

The financial ratios presented exhibit several notable trends over the observed periods.

Tax Burden

The tax burden ratio remains relatively stable throughout the timeline, fluctuating slightly around 0.77 to 0.81. This indicates a consistent proportion of earnings retained after taxes.

Interest Burden

The interest burden ratio shows minor variations, generally maintaining values between 0.83 and 0.95. The ratio peaks around early 2022, reaching approximately 0.95, suggesting a period with lower interest expenses relative to earnings, followed by a slight decline but staying above 0.88 in later periods.

EBIT Margin

EBIT margins exhibit noticeable fluctuations. There is a gradual increase from around 4.96% in mid-2019 to a peak near 8.96% by mid-2021. Subsequently, margins decline significantly to about 3.56% in early 2023 before rising moderately again toward 5.52% by mid-2025. This pattern indicates periods of improved operating profitability followed by a contraction and partial recovery.

Asset Turnover

Asset turnover remains fairly steady, predominantly ranging from 1.75 to 2.10. A slight upward trend is observed moving from 1.79 in mid-2019 to around 2.10 in mid-2022, with mild declines thereafter. This suggests consistent efficiency in using assets to generate sales, with some improvement during the mid-periods.

Financial Leverage

Financial leverage ratios increase steadily from about 3.5 in early periods to a peak exceeding 5.0 around late 2022, followed by a gradual decline back toward 3.7 by mid-2025. This rising and falling pattern implies an initial increase in use of debt or equity financing magnifying equity returns, later reduced to moderate levels.

Return on Equity (ROE)

ROE shows significant volatility with an overall upward trajectory through 2021 and early 2022, reaching a high just above 54%. Thereafter, a strong decline ensues, dropping below 25% in early 2023. Subsequently, ROE recovers moderately to around 30% by mid-2024 but trends downward again toward 25% by mid-2025. The fluctuations in ROE are influenced by varying profitability, leverage, and asset efficiency observed in other ratios.

In summary, the company experiences fluctuating operating margins and varying leverage levels, resulting in significant swings in equity returns. Asset utilization remains fairly consistent with slight improvement phases. Interest and tax burdens are relatively stable, providing a steady base for operational results. The peak in profitability and ROE around 2021-early 2022 followed by declines suggests cyclical or market-driven performance impacts during the observed periods.

The financial ratios provided indicate several noteworthy trends over the periods analyzed. The net profit margin, which measures profitability as a percentage of revenue, shows an overall fluctuating pattern. Beginning at 4.2% in early 2020, it increased gradually to a peak of around 6.56% in late 2021, indicating a phase of improved profitability. However, from early 2022 onward, the margin declined steadily, reaching a low of approximately 2.49% by early 2023. Subsequently, there was a mild recovery, with values stabilizing around 3.7% to 4.2% in the most recent quarters. This suggests some challenges in maintaining high profitability, followed by partial improvement.

The asset turnover ratio, indicating how efficiently assets generate sales, exhibited relative stability with minor variations. It started near 1.83 in early 2020, experienced a slight decline through late 2020, and then saw gradual improvement peaking around 2.1 in mid-2022. After this peak, asset turnover decreased somewhat, fluctuating near the 1.83 to 1.94 range in the later periods. The pattern suggests consistent asset utilization with occasional efficiency gains, though the ratios toward the end imply a slight reduction in operational efficiency.

Return on assets (ROA), representing overall profitability relative to total assets, showed a trend broadly consistent with the fluctuations seen in net profit margin. Beginning around 7.67% in early 2020, it increased significantly to above 12% in late 2021, aligning with the peak net profit margins and improved asset turnover rates during that time. This pointed to a period of strong financial performance. However, ROA then declined steadily through mid-2022 to about 5.21%, mirroring the reduction in net profit margin and slight drop in asset turnover. A moderate recovery followed, with ROA values stabilizing around 6.7% to 8.0% in the recent quarters, indicating an improvement in asset profitability though not reaching earlier highs.

Net Profit Margin

Initially increased to a high in late 2021, then declined sharply through 2022, followed by a partial rebound in profitability.

Asset Turnover

Relatively stable with minor cycles of improvement and decline, peaking mid-2022 and decreasing thereafter slightly.

Return on Assets (ROA)

Consistent with net profit margin trends, showing peak profitability in late 2021, then a decline, and moderate recovery recently.

Overall, the data reflect a period of strong profitability and operational efficiency culminating around late 2021, followed by a downturn in profitability and asset utilization in 2022. Recent quarters indicate efforts to stabilize and modestly improve financial performance. The correlation among the three ratios suggests that profitability challenges have had a notable impact on returns relative to assets, with operational efficiency playing a supportive but fluctuating role. Continuous monitoring will be important to assess whether the recent stabilization can lead to renewed growth in profitability and asset productivity.

Tax Burden

The tax burden ratio remained relatively stable from February 2020 through August 2025, fluctuating narrowly between 0.77 and 0.81. This indicates consistent tax expense management relative to pre-tax income over the periods analyzed.

Interest Burden

The interest burden ratio showed more variability but maintained a generally high level above 0.83 throughout the same timeframe. Starting at 0.90 in early 2020, it reached a low of 0.83 by October 2020, before increasing steadily to around 0.93 in late 2024 and early 2025. This suggests effective control of interest expenses relative to EBIT, with minor fluctuations possibly linked to financing strategies.

EBIT Margin

The EBIT margin demonstrated notable volatility across quarters. It began near 6% in early 2020, increased significantly to a peak of almost 9% in the first half of 2021, and then declined sharply during the latter part of 2021 through mid-2023, reaching lows near 3.5%. Subsequently, it recovered to about 5.5% by mid-2025. This pattern reflects shifting operational profitability, possibly influenced by changing cost structures, sales mix, or external market conditions.

Asset Turnover

Asset turnover ratios remained consistently strong and relatively stable over the period, fluctuating modestly between approximately 1.75 and 2.10. A slight upward trend is observed from early 2020 to mid-2022, followed by minor declines and recoveries thereafter. This stability suggests efficient utilization of assets to generate sales despite economic or operational challenges.

Return on Assets (ROA)

The ROA showed considerable fluctuations aligning with trends in EBIT margin and asset turnover. From early 2020, the ROA rose from about 7.7% to a peak exceeding 12% in 2021, indicating strong overall profitability and asset efficiency. This was followed by a downward trend through 2022 and mid-2023 to approximately 5.2%, before gradually recovering to around 7.5% by mid-2025. The movements in ROA highlight shifts in profitability, asset management, and possibly external factors affecting net income over time.

Tax Burden

The tax burden ratio, observable from February 1, 2020, to August 2, 2025, remains relatively stable and consistent over this period. Values fluctuate narrowly around 0.78 to 0.81, indicating that the company sustains a fairly constant proportion of net income after taxes. Slight increases to approximately 0.81 are noted around early 2023, followed by a modest decline back to roughly 0.77 to 0.78 in later years, suggesting no significant changes in tax efficiency or tax rates during the timeframe.

Interest Burden

The interest burden ratio shows more noticeable variation. Starting at 0.90 in early 2020, there is a dip to around 0.83 to 0.85 mid-2020, followed by a notable recovery and gradual increase through subsequent quarters. By late 2021 and onwards into 2025, values stabilize at a higher level near 0.92 to 0.93. This pattern suggests periods of varying interest expenses in relation to earnings before interest and taxes (EBIT), with an overall improvement in interest expense control or decreased interest costs in the later periods.

EBIT Margin

The EBIT margin experiences considerable fluctuations across the periods. Initial margins hover near 6%, followed by a modest increase peaking at about 8.96% in mid-2021. Thereafter, a marked decline occurs, reducing the margin to approximately 3.57% to 3.56% by late 2022 and early 2023. Subsequently, the margin shows a steady recovery trend, climbing back to around 5.79% by mid-2024, before slightly tapering off near 5.23% through mid-2025. This volatile pattern may reflect operational challenges, varying cost structures, or shifts in revenue and expenses affecting operating profitability.

Net Profit Margin

The net profit margin trends generally mirror the EBIT margin but with a somewhat smoother curve. Margins increase from about 4.2% in early 2020 up to a high near 6.3% in mid-2021, followed by a significant decrease to levels around 2.49% to 2.55% at the start of 2023. Thereafter, a consistent upward trend returns, reaching approximately 4.18% by mid-2024, before slightly declining again to near 3.72% by mid-2025. This pattern indicates variable bottom-line profitability influenced by operating income fluctuations as well as tax and interest burden dynamics over the analyzed quarters.