September 18, 2026
Bonus Content: Target’s $30B Owned Brands Have a Margin Problem
Editor’s Note: Our friend Louis Navellier has been a guest at Mar-a-Lago, President Trump’s private residence in Palm Beach, Florida. He’s one of America’s top tech investors, managing a $1.1 billion portfolio – including $358 million in AI stocks. He called Nvidia before it went up 44,000%. He predicted the dot-com crash and the 2020 Covid rally. And now he’s revealing what he calls the biggest prediction of his 40-year career.
Dear Reader,
Deep in the Appalachian Mountains of Tennessee…
Behind a triple layer of razor wire and a security clearance most Americans will never hold…
Something extraordinary is being built.
You won’t hear about it on CNBC.
The Wall Street Journal hasn’t touched it.
And yet, according to my research, what’s happening inside this facility will trigger one of the most dramatic wealth transfers in American history.
I know this place well.
It’s the same “secret city” that gave America the atom bomb.
The same lab that turned the tide of World War II.
And now – under a directive from President Trump himself – America’s top scientists and engineers have returned to this site for one purpose:
To build a new category of AI computer so powerful…
Trump himself compared it to a Manhattan Project – but for AI.
And I believe – based on months of exhaustive research – this device is going online very soon.
When it does, it won’t just leapfrog ChatGPT, Gemini, and even Elon’s Grok…
It will accelerate AI breakthroughs by 360-fold.
Breakthroughs that used to take five years? They’ll happen in five days.
And that will trigger a $100 trillion reset of the AI markets – the biggest disruption I’ve seen in my 40-year career.
I called Nvidia before it went up 44,000%. Apple before it went up 36,000%. Microsoft before its 60,800% rise.
But nothing in four decades has looked quite like this opportunity.
I’ve prepared a full presentation with the details – including the name and ticker of the one company I believe is best positioned to profit.
Click here to watch it now, free of charge.
Regards,
Louis Navellier
Senior Quantitative Investment Analyst, InvestorPlace
P.S. The “secret city” in Tennessee has been off-limits to the public for decades. But what’s being built there right now is about to become impossible to ignore. When Trump flips the “on switch,” I expect it to trigger a $100 trillion shock to the AI markets. Go here for full details – including the ticker symbol – before this video comes down.
Target’s $30B Owned Brands Have a Margin Problem
Target’s turnaround is real. The question is whether the engine powering it can sustain what the stock already reflects.
Same-store sales rose 5.6% in the first quarter of fiscal 2026, the retailer’s first increase in that metric in five quarters. Net sales grew 6.7% year over year, with traffic up 4.4% and digital comparable sales climbing 8.9%, while non-merchandise sales grew nearly 25% and gross margin reached 29%.
Target improved its adjusted operating margin to 4.5% from 3.7%, but the adjusted SG&A expense rate crept higher, from 21.7% to 21.9%. Spending is outpacing sales, which matters more as the easy comparisons fade.
The private label push is central to CEO Michael Fiddelke’s turnaround story. Target says it has a lineup of more than 40 owned brands that generate more than $30 billion annually in revenue. At the value end, the February 2024 launch of dealworthy, a low-price owned brand with items starting at less than $1, is part of the push to win back budget-focused shoppers.
Private labels carry structurally better margins than national brands, which is the whole thesis. But the acceleration in same-day delivery, the other pillar of the value pitch, costs money to run. Same-day services, including Drive Up, Order Pickup and same-day delivery, generated more than $14 billion in sales in fiscal 2025 and accounted for about two-thirds of digital sales. The paid Target Circle 360 tier includes same-day delivery, free two-day shipping, and early access to select sales events, and the company has said its membership count has the potential to more than triple over the next three years. Scaling that benefit to three times as many members is not free.
Amid rising inflation and tariffs, consumers are extremely price-sensitive, with a survey showing about 71% want retailers to lower prices. Target is reading that correctly. The retailer has expanded its selection of low-priced toys and is keeping school supplies starting at less than $1, with thousands of items priced under $20. The assortment is sharper. The value signal is clearer than it’s been in years.
What traders should watch: with the stock’s recovery already well advanced, another sales beat may not be enough. The central test is profitability. Management expects the full-year operating margin to exceed the 2025 adjusted rate of 4.6% by more than 20 basis points, a low bar given the revenue momentum. If Q2 gross margin holds at or above 29% while SG&A stabilizes, the bull case firms up. If delivery expansion keeps eating into the efficiency gains from private label, the stock’s 2026 rally will look like it ran ahead of the earnings recovery rather than alongside it.
