Target’s latest turnaround effort comes the same month Walmart soared past $1 trillion in market value, stoking investor fears that the retail chain’s efforts are too little and too late.
Shares fell 2% Tuesday after the company cut 500 management jobs and promoted two longtime insiders to new roles, including its chief merchant. The moves come a week into the tenure of CEO Michael Fiddelke, who joined the company in 2003 as an intern — and whose promotion has been met with skepticism by investors who were hoping for some outside blood and, with it, fresh ideas. Even Target’s decision to use money saved by white-collar job cuts to boost pay for store workers is copied from Walmart, which pivoted faster to digital sales and boosted wages under the protection of its billionaire family, the Waltons.
Playing catch-up has left Target vulnerable to activist investors: TOMS Capital Investment Management still has a big stake in the company and has discussed its — still publicly vague — concerns with management, people familiar with the matter said. A Target spokesperson declined to comment.