We are contracting at a rapid rate. If this continues, there will be more cuts and if the stock price keeps dropping we will be an acquisition target by another company or a private equity group. If that happens, the private equity group will come and cut to the bone. I've been there and I've seen what happens, trust me we do not want to be owned by a private equity interest, it's brutal, they will load us with debt, take the money and then cut payroll to increase cash flow from operations. They will milk the cash as long as they can, then sell us together with the debt to someone and recoup all the money they put in. That's how they operate. The execs, the C-line up and other higher ups will end up with great golden parachutes, will take care of themselves and their families for centuries. For employees of Target there will only be layoffs, blood, sweat and tears. It's a scary prospect, so we better hope things will turn around.
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Morons are running wild on this site
I was caught in the layoffs last year, so I don't have inside knowledge of what's been happening over the last 12 months.
That said, while I agree that this is not something that is imminent, I will say that there is a well known cycle that companies can fall into called "The Death Spiral". Basically a company is not making enough money, so they start to cut costs. Those cuts impact the product, which in turn impacts sales. Because sales are low, costs have to be cut again. This cycle repeats until the company cannot sustain itself and either is swallowed up by another, or goes out of business. Think about it like watching a toilet empty. The water moves slowly on the outside of the spiral, but much faster on the inside. Target isn't near the inside yet, but the signs of swirling are there.
In the mid 2000s Target began to do things like buy back stock with profits rather than invest in growth and efficiencies. They started to look at making the quarterly numbers look good to keep investors happy rather than looking to the long term impact of those decisions. I firmly believe that the quick and large entrance into Canada was due to this. They were concerned that the investors wouldn't be happy with a longer rate of return, so they tried to go in fast and hard to start getting money back and it didn't work.
I would argue that they are at a crossroads right now. This cutting could be a refocusing that allows them to plan and invest in the future. Or it could be the continuation of the death spiral. Only time will tell.
Buy a water cooler at home, visit with your friends then you can do exactly what you did for target. nothing!!! You guys don't understand that business models are not about a red dot and khakis, I hear Walmart has openings for greeters! Hee hee
Oh yeah you will cut cost and 550 jobs doesnt tet you there
No Acquisition. But don't think that BC Wont use the PE hammer of cost cutting.
Isn't our stock at all time high levels? To acquire us you'd need to have 50 billion dollars, I do not think that anyone on the private equity side has that kind of money. No other competitor has that kind of money. You'd need federal reserve or Apple or Exxon kind of money here.
Anonymous66845 - exacetely
Your p/e is double industry you are a long way froma buyout. The stock would have to be at like 10-20 for that that to be a concern
The title is not spelled properly
I like the title, sounds so bombastic
OK, I am not the original poster but many things will come into play if we continue to drop market cap. I 100% agree that a takeover is out of questions here but the dynamics will change if things spiral out of control which is unlikely but possible.
You are delusional. Do you even have a notion of how a $70 billion dollar company works?
Sorry, but this is blowing things out of proportion at this point in time.
OK, let's see what happens. It's not cool to be bullying here.
Talk about Chicken Little...
you are an idiot actually
Perhaps a bit of an overreaction? Target is a long, long way from being acquired at this point.
This is an interesting prospect here, I hope we do not go there...