Retail giant Target suffered another financial setback after JPMorgan downgraded its stock as its market value plummeted by $14 billion, amid backlash to its controversial LGBTQ Pride product release.
The embattled brand’s shares dropped for the ninth consecutive day Wednesday, falling by a further 2.14 percent as the company is in the midst of its longest stock losing streak in 23 years.
Before the controversy, the company’s market value had been $74 billion, with shares trading at $160.96 at the close of markets on May 17.
And despite efforts by the brand to backpedal on its disastrous campaign, continuous stock falls led JPMorgan to downgrade its stock from ‘neutral’ to ‘overweight’ on Thursday, citing ‘too many concerns rising’.
‘We continue to believe that the consumer is broadly weakening while the share of wallet shift away from goods (51% of [Target’s] sales) is ongoing,’ wrote JPMorgan analyst Christopher Horvers, according to MarketWatch.
Horvers also cited ‘recent company controversies’ as the reason Target has suffered devastating financial losses, which came after ‘an impressive run of 12 consecutive positive quarters’.
It comes as the chain seeks to recover from backlash against the product line, with some customers taking particular offence to its female swimwear range – which came with the option to ‘tuck’ male genitalia.
As customers rebelled against the move, the brand made ‘adjustments’ to its Pride merchandising plans, including removing displays ‘that have been at the center of the most significant confrontational behavior’ at some of its stores, CEO Brian Cornell said in a statement last week.
Some Southern stores were forced to move merchandise – many of which were designed by Erik Carnell, a transgender man and self-proclaimed Satanist – to the back of stores.
It was done to avoid a ‘Bud Light situation’ – a disastrous marketing decision to promote Bud Light’s beer with trans influencer Dylan Mulvaney – following a consumer boycott of its Pride Month items.
