Three experts weigh in on what it could mean for the market.
Jharonne Martis, director of consumer research at Refinitiv, said Target has invested in recent years to succeed in today's environment.
"Target definitely smashed it out of the park [Wednesday] morning with triple-digit numbers in e-commerce and it's very evident that today more than ever [a] good omnichannel strategy is key for any retailer to survive. It's not just about selling key essentials but really investing in the omnichannel experience -- something that Target did five years ago. It used to beat on earnings, but then it stopped. It used to take a hit in the past because it used to tell us that it's going to invest heavily in new technology, digital and the omnichannel experience which today is paying off with triple-digit numbers in e-commerce and the same can be said for other brands that want to succeed."
Michael Lasser, broadline and hardline retail analyst at UBS, said retail evolution is key to separate the winners from the losers.
"I would argue there's going to be several winners and a lot of other players in the retail sector as trends unfold over the next couple of years and with that being said, there's been about three years of transformation in retail in just three months. So, who's going to be the winners? It's going to be the leading players like Home Depot, like Lowe's, Walmart and Target are going to be on that list as well. Those who can supply the omnichannel needs of consumers, those who are well positioned to offer good value, and those who are really agile in this environment, because one characterization of what's happening right now is things are changing very fast. As a retailer, they need to respond quickly and stay ahead of the competition."
David Bianco, chief investment officer at DWS Group, still prefers growth stocks over value.
"I think this is an opportunity to lighten up on risk. Find the opportunities in the other asset classes that are still there. I do think this market has taken a giant leap of faith. And when it comes to these tech stocks, which that's where I'm most enthusiastic, there's still a lot of blue-sky valuations so if you're going to buy blue sky, make sure it's the most crystal clear of blue, and that's why we're sticking with the proven growth stocks that you will find … and we find no reason to rotate away from that toward the value stocks at this time."