Key Financial Metrics & Price Targets Top Stocks

Part I: Fundamental Analysis

Company Overview

Target Corporation (TGT)

Target Corporation is a prominent American retail company operating discount and mid-range general merchandise stores. Target’s core business includes a diverse range of merchandise such as apparel, home furnishings, household essentials, electronics, and toys. With around 2,000 stores across the United States and a growing e-commerce presence, Target is a key player in the retail industry.

Financial Highlights

  • Revenue (FY2022): $107.4 billion
  • Net Income (FY2022): $4.1 billion
  • Total Assets (Q4 2022): $54.8 billion
  • Total Liabilities (Q4 2022): $39.3 billion
  • Cash & Equivalents (Q4 2022): $3.8 billion

Vertical Analysis

Income Statement

  • Cost of Sales: 72.4% of total revenue
  • SG&A Expenses: 20.0% of revenue
  • Depreciation and Amortization: 2.6% of revenue
  • Operating Income Margin: 5.9%

Balance Sheet

  • Current Assets: 45.9% of total assets
    • Cash & Equivalents: 6.9% of assets
  • Non-Current Assets: 54.1% of total assets
  • Current Liabilities: 36.8% of total liabilities
    • Accounts Payable: 21.3% of liabilities
  • Long-Term Debt: 31.5% of total liabilities

Cash Flow Statement

  • Operating Cash Flow: $8.6 billion
  • Free Cash Flow: $2.3 billion
  • Capital Expenditures: $6.3 billion

Ratio Analysis

Profitability Ratios

  • Gross Profit Margin: 27.6%
  • Operating Profit Margin: 5.9%
  • Net Profit Margin: 3.9%
  • Return on Assets (ROA): 6.8%
  • Return on Equity (ROE): 33.6%

Liquidity Ratios

  • Current Ratio: 0.91
  • Quick Ratio: 0.27

Solvency Ratios

  • Debt-to-Equity Ratio: 1.47
  • Interest Coverage Ratio: 9.0x

Efficiency Ratios

  • Asset Turnover: 1.73x
  • Inventory Turnover: 5.8x

Price Targets and Analyst Recommendations

  • Average Price Target: $185.37
  • Price Range: $140.00 to $220.00
  • Analyst Recommendation: Majority “Buy”

Conclusion

Target is a retail giant with consistent revenue growth and a strong market position. While profitability has been volatile, the company maintains a solid cash flow and reasonable leverage. Analysts have a positive outlook on Target, reflecting confidence in its ability to adapt and thrive.

Company Overview

NVIDIA Corporation (NVDA)

NVIDIA Corporation is a leading technology company specializing in graphics processing units (GPUs), system-on-chip (SoC) units, and related software. NVIDIA’s products are pivotal in gaming, professional visualization, data centers, and automotive systems.

Financial Highlights

  • Revenue (FY2022): $60.9 billion
  • Net Income (FY2022): $29.8 billion
  • Total Assets (Q4 2022): $51.8 billion
  • Total Liabilities (Q4 2022): $17.1 billion
  • Cash & Equivalents (Q4 2022): $26.0 billion

Vertical Analysis

Income Statement

  • Gross Profit: 72.7% of total revenue
  • R&D Expenses: 15.6% of revenue
  • SG&A Expenses: 8.8% of revenue
  • Operating Income Margin: 61.6%

Balance Sheet

  • Current Assets: 62.9% of total assets
    • Cash & Equivalents: 50.2% of assets
  • Non-Current Assets: 37.1% of total assets
  • Current Liabilities: 18.8% of total liabilities
    • Accounts Payable: 6.6% of liabilities
  • Long-Term Debt: 21.4% of total liabilities

Cash Flow Statement

  • Operating Cash Flow: $28.1 billion
  • Free Cash Flow: $19.9 billion
  • Capital Expenditures: $8.2 billion

Ratio Analysis

Profitability Ratios

  • Gross Profit Margin: 72.7%
  • Operating Profit Margin: 61.6%
  • Net Profit Margin: 48.8%
  • Return on Assets (ROA): 38.6%
  • Return on Equity (ROE): 91.5%

Liquidity Ratios

  • Current Ratio: 4.17
  • Quick Ratio: 3.39

Solvency Ratios

  • Debt-to-Equity Ratio: 0.26
  • Interest Coverage Ratio: 311.1x

Efficiency Ratios

  • Asset Turnover: 0.79x
  • Inventory Turnover: 10.0x

Price Targets and Analyst Recommendations

  • Average Price Target: $1,039.33
  • Price Range: $478.40 to $2,762.12
  • Analyst Recommendation: Majority “Buy”

Conclusion

NVIDIA is a powerhouse in the semiconductor industry with impressive financial performance. Its high profitability margins, strong cash position, and low leverage make it a highly attractive investment. Analysts are very optimistic about NVIDIA’s growth prospects.

Company Overview

Ross Stores, Inc. (ROSS)

Ross Stores, Inc. operates off-price retail chains, including Ross Dress for Less and dd’s DISCOUNTS. These stores offer discounted apparel, accessories, footwear, and home goods across the United States.

Financial Highlights

  • Revenue (FY2022): $20.4 billion
  • Net Income (FY2022): $1.9 billion
  • Total Assets (Q4 2022): $11.8 billion
  • Total Liabilities (Q4 2022): $8.8 billion
  • Cash & Equivalents (Q4 2022): $4.9 billion

Vertical Analysis

Income Statement

  • Cost of Goods Sold: 67.8% of total revenue
  • SG&A Expenses: 20.0% of revenue
  • Operating Income Margin: 12.4%

Balance Sheet

  • Current Assets: 65.7% of total assets
    • Cash & Equivalents: 41.3% of assets
  • Non-Current Assets: 34.3% of total assets
  • Current Liabilities: 31.3% of total liabilities
    • Accounts Payable: 22.5% of liabilities
  • Long-Term Debt: 16.8% of total liabilities

Cash Flow Statement

  • Operating Cash Flow: $2.5 billion
  • Free Cash Flow: $1.3 billion
  • Capital Expenditures: $1.2 billion

Ratio Analysis

Profitability Ratios

  • Gross Profit Margin: 32.2%
  • Operating Profit Margin: 12.4%
  • Net Profit Margin: 9.2%
  • Return on Assets (ROA): 10.4%
  • Return on Equity (ROE): 40.9%

Liquidity Ratios

  • Current Ratio: 1.77
  • Quick Ratio: 1.20

Solvency Ratios

  • Debt-to-Equity Ratio: 1.18
  • Interest Coverage Ratio: 24.1x

Efficiency Ratios

  • Asset Turnover: 1.13x
  • Inventory Turnover: 4.8x

Price Targets and Analyst Recommendations

  • Average Price Target: $163.15
  • Price Range: $145.00 to $173.00
  • Analyst Recommendation: Majority “Buy”

Conclusion

Ross Stores is a strong player in the off-price retail segment with consistent revenue growth and high profitability. Its solid liquidity and manageable debt levels support future growth. Analysts are optimistic, reflecting confidence in Ross’s ability to sustain its market position.

Company Overview

Zoom Video Communications, Inc. (ZOOM)

Zoom Video Communications provides a unified communications platform for video conferencing, online meetings, chat, and webinars. Its platform is widely used by businesses, educational institutions, and individual users globally.

Financial Highlights

  • Revenue (FY2022): $4.5 billion
  • Net Income (FY2022): $637.5 million
  • Total Assets (Q4 2022): $9.4 billion
  • Total Liabilities (Q4 2022): $1.9 billion
  • **Cash & Equivalents (Q4 202

2)**: $7.0 billion

Vertical Analysis

Income Statement

  • Cost of Revenue: 23.6% of total revenue
  • R&D Expenses: 23.5% of revenue
  • Sales and Marketing Expenses: 41.5% of revenue
  • G&A Expenses: 10.3% of revenue
  • Operating Income Margin: 10.1%

Balance Sheet

  • Current Assets: 79.8% of total assets
    • Cash & Equivalents: 74.1% of assets
  • Non-Current Assets: 20.2% of total assets
  • Current Liabilities: 23.4% of total liabilities
    • Accounts Payable: 4.5% of liabilities
  • Long-Term Debt: 2.0% of total liabilities

Cash Flow Statement

  • Operating Cash Flow: $1.6 billion
  • Free Cash Flow: $1.5 billion
  • Capital Expenditures: $94.0 million

Ratio Analysis

Profitability Ratios

  • Gross Profit Margin: 76.4%
  • Operating Profit Margin: 10.1%
  • Net Profit Margin: 14.1%
  • Return on Assets (ROA): 4.1%
  • Return on Equity (ROE): 9.0%

Liquidity Ratios

  • Current Ratio: 4.50
  • Quick Ratio: 4.26

Solvency Ratios

  • Debt-to-Equity Ratio: 0.91
  • Interest Coverage Ratio: 9.6x

Efficiency Ratios

  • Asset Turnover: 0.29x

Price Targets and Analyst Recommendations

  • Average Price Target: $77.27
  • Price Range: $55.00 to $95.00
  • Analyst Recommendation: Majority “Hold”

Conclusion

Zoom has demonstrated impressive growth and strong profitability during the pandemic, though future growth may slow. Its robust cash position and low debt levels provide financial stability. Analysts have a cautious outlook, reflecting concerns about sustaining growth post-pandemic.

Company Overview

Block, Inc. (SQ)

Block, Inc., formerly Square, Inc., is a financial technology company offering products and services for businesses and individuals, including commerce solutions, mobile payments, bitcoin trading, and more.

Financial Highlights

  • Revenue (FY2022): $22.9 billion
  • Net Income (FY2022): $383.5 million
  • Total Assets (Q4 2022): $24.7 billion
  • Total Liabilities (Q4 2022): $13.3 billion
  • Cash & Equivalents (Q4 2022): $6.4 billion

Vertical Analysis

Income Statement

  • Transaction-Based Costs: 65.2% of total revenue
  • Software and Data Product Costs: 13.6% of revenue
  • SG&A Expenses: 17.0% of revenue
  • Operating Income Margin: 4.2%

Balance Sheet

  • Current Assets: 56.8% of total assets
    • Cash & Equivalents: 25.7% of assets
  • Non-Current Assets: 43.2% of total assets
  • Current Liabilities: 41.6% of total liabilities
    • Accounts Payable: 9.0% of liabilities
  • Long-Term Debt: 20.1% of total liabilities

Cash Flow Statement

  • Operating Cash Flow: $296.0 million
  • Free Cash Flow: $396.3 million
  • Capital Expenditures: $129.7 million

Ratio Analysis

Profitability Ratios

  • Gross Profit Margin: 34.8%
  • Operating Profit Margin: 4.2%
  • Net Profit Margin: 1.7%
  • Return on Assets (ROA): 0.3%
  • Return on Equity (ROE): 1.9%

Liquidity Ratios

  • Current Ratio: 1.64
  • Quick Ratio: 1.00

Solvency Ratios

  • Debt-to-Equity Ratio: 0.29
  • Interest Coverage Ratio: 3.4x

Efficiency Ratios

  • Asset Turnover: 0.93x

Price Targets and Analyst Recommendations

  • Average Price Target: $91.48
  • Price Range: $40.00 to $106.00
  • Analyst Recommendation: Majority “Buy”

Conclusion

Block is a leading fintech company with strong revenue growth, driven by its Square and Cash App ecosystems. Despite lower profitability margins due to ongoing investments, its solid cash position and positive analyst sentiment suggest potential upside. Investors should monitor its ability to sustain growth and profitability.

Company Overview

Meta Platforms, Inc. (META)

Meta Platforms, Inc., formerly Facebook, Inc., is a leading social media and technology company providing platforms like Facebook, Instagram, WhatsApp, and Messenger. It is also investing in augmented and virtual reality through Reality Labs.

Financial Highlights

  • Revenue (FY2022): $142.7 billion
  • Net Income (FY2022): $45.8 billion
  • Total Assets (Q4 2022): $214.1 billion
  • Total Liabilities (Q4 2022): $80.4 billion
  • Cash & Equivalents (Q4 2022): $58.1 billion

Vertical Analysis

Income Statement

  • Cost of Revenue: 18.5% of total revenue
  • R&D Expenses: 25.8% of revenue
  • Sales and Marketing Expenses: 16.8% of revenue
  • G&A Expenses: 10.8% of revenue
  • Operating Income Margin: 38.6%

Balance Sheet

  • Current Assets: 52.4% of total assets
    • Cash & Equivalents: 27.1% of assets
  • Non-Current Assets: 47.6% of total assets
  • Current Liabilities: 26.3% of total liabilities
    • Accounts Payable: 5.9% of liabilities
  • Long-Term Debt: 16.5% of total liabilities

Cash Flow Statement

  • Operating Cash Flow: $76.4 billion
  • Free Cash Flow: $35.1 billion
  • Capital Expenditures: $41.2 billion

Ratio Analysis

Profitability Ratios

  • Gross Profit Margin: 81.5%
  • Operating Profit Margin: 38.6%
  • Net Profit Margin: 32.1%
  • Return on Assets (ROA): 17.3%
  • Return on Equity (ROE): 33.4%

Liquidity Ratios

  • Current Ratio: 2.68
  • Quick Ratio: 2.55

Solvency Ratios

  • Debt-to-Equity Ratio: 0.25
  • Interest Coverage Ratio: 91.3x

Efficiency Ratios

  • Asset Turnover: 0.54x

Price Targets and Analyst Recommendations

  • Average Price Target: $512.99
  • Price Range: $260.00 to $593.00
  • Analyst Recommendation: Majority “Buy”

Conclusion

Meta Platforms is a dominant force in social media and technology with strong financial performance. Its significant investments in new technologies like the metaverse aim to diversify revenue streams. Despite regulatory challenges, Meta’s robust cash flow and positive analyst sentiment indicate potential upside. Investors should watch its strategic execution and adaptation to industry changes.