Come on, Target. Do better.

Come on, Target. Do better.

Brian Sozzi · Executive Editor

Sun, August 30, 2026 at 3:30 PM GMT+3 4 min read

• TGT -1.39%
• DKS +0.35%

So I am hanging out on Yahoo Finance AlphaSpace on Wednesday morning, a few minutes after calling out Dick's Sporting Goods (DKS) on Instagram for its horrific earnings day this week.

I randomly check the stock price of fellow big box retailer Target (TGT), only to find it had an ugly session the day before. It caught my attention because the broader market had hung in there, and I didn't see any analyst downgrades on Target.

I then came across something on Target with the word "backlash" in it.

"What the hell did this company do now?" I muttered to myself.

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It wasn't hard to find out. Target apologized this week for selling a kids' circus clown Halloween costume that critics said evoked racist minstrel imagery. The orange-and-black costume, which included gloves, a top hat, and a mask resembling a smiling mouth with large teeth, was removed from the website, but not before consumers took Target to task.

"We removed an offensive Halloween costume that should never have been part of our assortment," Target said in a statement. "It is no longer for sale. As a company, we got this wrong, and we are deeply sorry. We know this is especially hurtful for our Black guests, team members and partners. Removing the costume is an important first step, and we are looking closely at how this happened and what needs to change to ensure this won't happen again."

The thing is, Target didn't just get this wrong. It has gotten a lot of things wrong over the past few years. Remember the 2023 Pride merchandise backlash? How about the January 2025 DEI rollback initiatives?

All of this is getting absurd, and investors need to be asking tough questions of management. Frankly, so do the Wall Street analysts who cover Target, because it's weighing on the business and could damage the valuation over time.

Consumers have more power at their fingertips than ever before — they can take to social media to air grievances or shop at other websites to buy stuff — and I think Target's stock falling on this news is evidence of that.

Are Target's internal product audit systems broken? Is some kind of detection software not functioning correctly? Are the hiring processes for corporate employees dysfunctional? Are corporate employees disgruntled because of big layoffs under the new CEO? Are long-tenured employees mailing it in?

What is structurally wrong inside of this retail giant that decisions like these get made time and time again? Whatever the issue, it has to be fixed by the newish executives running the company. We don't see these things happening at Costco (COST)!

Keep in mind, this comes at a time when Target finally has some form of turnaround story emerging.

After chopping prices and overhauling its merchandise department, Target did its part for the second straight quarter to signal that its worst days in 2024 and 2025 are in the rearview mirror.

Earlier this month, the retailer delivered another big earnings beat versus estimates. Sales increased in all merchandise departments, led by beauty and food. Store traffic increased.

The company even jacked up its full-year sales and profit outlooks.

"We're encouraged," Target CEO Michael Fiddelke told me. "We laid out a plan for the year that had a lot of change in it — more change to what we were selling and how we were going to sell it than in the last decade. And a couple of quarters in, it's great to see a strong guest response to some of the places we're making changes."

"There's a lot of work still in front of us," Fiddelke added, "and the goal isn't a couple strong quarters. The goal is years of sustained top-line growth. And so we'll turn the page on this one and get back to work."

Since the start of 2026, Target has moved quickly to rewrite its merchandising wrongs to improve traffic to its stores and online.

It has expanded wellness offerings, added 3,000 beauty products across 60 new brands, reset 75% of home decorative accessories, accelerated food and beverage innovation, and introduced a back-to-school assortment that is more than 50% new, Jefferies analyst Corey Tarlowe pointed out in a recent note.

All of this is great to see from Target.

But the company has to fix the core problems that continue to put it in a negative light across the US. Consumers and investors deserve way, way better.

Brian Sozzi is Yahoo Finance's Executive Editor, host of the 'Power Players With Brian Sozzi' podcast and a member of Yahoo Finance's editorial leadership team. Follow Sozzi on X @BrianSozzi, Instagram, and LinkedIn. Tips on stories? Email brian.sozzi@yahoofinance.com.

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