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Sell these stocks first as wages rise

Target

Mega-retailer Target (TGT) has already been facing a big uphill challenge. The company has struggled to keep pace online, and earnings are expected to rise just 3.2% next year. If the company is forced to lift wages to keep employees, earnings could rise less than the current tepid forecast. The company impressed the market in November with a strong Q3 report, but March’s report was not nearly as good, with an in-line quarter that left investors wondering how strong the company’s turnaround actually is. The stock has been stuck in a sideways pattern, and wage growth and inflationary pricing could hurt the company moving forward. TGT is getting better, but investors may want to consider locking in the last few months’ gains and looking for a better value elsewhere.

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Chart courtesy of www.stockcharts.com

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Michael Fowlkes

Michael Fowlkes is a financial writer who has been with the Fresh Brewed Media family since 2004. Over the course of his tenure with Fresh Brewed Media, he has worn many hats, including portfolio manager, options analyst, and writer. Michael received his undergraduate degree from Virginia Tech in Accounting and got his start in finance working as a stock trader for six years at Chase Investment Counsel in Charlottesville, Va.