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UBS upgrades Target to buy, says pandemic-era strength will continue

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Shoppers at a Target store in New York.
Scott Mlyn | CNBC

Investors should feel comfortable betting on Target's success continuing even as the economy reopens, according to UBS.

The big-box retailer continued to grow its margins during the first fiscal quarter from a year earlier, and its stock has gained 30% year to date. However, shares are trading within 10% of the average analyst price target, according to FactSet, implying that some on Wall Street are skeptical that the run can continue.

UBS analyst Michael Lasser upgraded the stock to buy from neutral, saying in a note to clients that Target's profitability should remain strong even as the pandemic ends and stimulus programs wane.

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