Target’s stock was downgraded on Thursday by JPMorgan, the largest bank in the United States, amid a consumer backlash over the store’s LGBT product campaign.
“We continue to believe that the consumer is broadly weakening while the share of wallet shift away from goods (51% of [Target’s] sales) is ongoing,” JPMorgan analyst Christopher Horvers wrote, according to Market Watch.
The stock was demoted from overweight, which means the broker has a positive outlook on the company’s prospects due to its current share price and that the stock is considered a strong buy, to neutral, which means the broker believes the investor should hold the stock as its price may not change.
“While still positive on a [three-year] basis, [Target] has been giving back share on a [one-year] view and we believe this share loss could accelerate into back to school and linger into holiday given consumer pressures and recent company controversies,” Horvers added. “This could turn [Target’s] traffic negative after an impressive run of 12 consecutive positive quarters.”
Target’s sales, 51 percent of which come from discretionary categories like apparel, hardline, and home, are declining due to boycotts, Horvers suggested. Compounded with factors like student-loan payments potentially coming due soon and customers becoming less dedicated to Target as a brand, Horvers concluded that company performance could continue to worsen.
Since May, Target’s stock has been trending downward in what Market Watch said was its longest losing streak in 23 years, according to its analysis of Dow Jones data. On Wednesday, the stock hit its lowest closing price since August 11, 2020.
A shopping rebellion among conservatives erupted when it was revealed last month that Target had contracted with a vendor that sells Satanist merchandise, some of which glorifies violence, to create products for its “PRIDE” collection.
While Target does not sell the Satanist-inspired products, the retail giant sealed a collaboration with Abprallen to create pride-related products, such as a messenger bag saying “We Belong Everywhere” across trans-flag colors and planets, a tote bag with the message “Too Queer for Here” beneath a UFO, and a “Cure Transphobia, Not Trans People” sweatshirt.
“I imagined what it would be like for a younger version of myself to see something more specific, more tailor made than a lacklustre rainbow flag. I wanted to create a range that would embrace younger me and tell him that who he is is more than OK, that being trans is special and wonderful and that the closet is not made for him to thrive in,” Abprallen’s owner, a self-identifying “gay trans man” who goes by “Erik,” wrote on Instagram to announce the partnership with Target.
After outrage ensued and Target removed the three Abprallen products from its shelves, Erik claimed that the retail giant was fully aware that the artist promoted Satanist messaging, but told him that it would be inappropriate for Target specifically.
“When I was approached to create products for Target they told me that my work such as ‘Satan Respects Pronouns’ wouldn’t be a good fit, they were observant enough and had the necessary critical thinking skills to realise that my use of occult imagery is as harmless as any horror movie targeted towards adults but wanted my collection for adults to be a bit less gothic,” Erik wrote on Instagram.
Target also came under fire after social-media users highlighted that the retail giant was selling “tuck-friendly” swim suits, designed to conceal the male genitalia.
A Christian Major League Baseball player speaking out against Target’s embrace of LGBT-themed merchandise upped the ante on the controversy. Earlier this week, Anthony Bass, pitcher for the Toronto Blue Jays, shared a post on social media that urged Christians to boycott Target and Bud Light for their recent celebrations of transgenderism. Anheuser-Busch stock was also downgraded by HSBC after a similar boycott inspired by Bud Light’s partnership with transgender influencer Dylan Mulvaney.
Prompted by reporters days later, however, Bass apologized for his behavior, sparking more anger among conservatives, who felt that the MLB pressured him into compromising his values.
“I recognize yesterday I made a post that was hurtful to the Pride community, which includes friends of mine and close family members of mine, and I’m truly sorry for that,” Bass told the media. “I just spoke with my teammates, shared with them my actions yesterday. Right now I’m using the Blue Jay’s resource to better educate myself and make better decisions moving forward.”