What happened 

Shares of Target (TGT 1.92%) popped 5.4% on Tuesday, following bullish analyst commentary. 

So what

Jefferies analyst Corey Tarlowe boosted the firm's rating on Target's stock from hold to buy. He sees the discount retail chain's share price rising roughly 18% to $185.

Tarlowe acknowledged that Target, like many retailers, is facing a "challenging" market environment. Heightened inflation is denting its customers' budgets, while a sluggish economy and nearly constant predictions of an imminent recession are weighing on consumer sentiment. Yet Tarlowe argues that Target's depressed stock price -- its shares are down more than 30% in 2022 -- presents investors with an attractive buying opportunity.

Tarlowe highlighted Target's investments in its supply chain network and its work to improve its inventory management capabilities. He thus expects the retailer's profit margins will increase next year. He also believes these moves place Target in a stronger competitive position than many of its rivals.

Now what 

CEO Brian Cornell made some positive comments at an investment conference earlier this week suggesting that Target's upcoming holiday shopping season could be stronger than many investors feared.  

"We continue to see a healthy guest shopping in our stores and shopping online," Cornell said. "We'll see how they react throughout the holiday season, but when we talk to them they continue to say they want to celebrate the holidays."

Cornell also said that although inflation is driving some customers to trade down to alter their purchasing patterns, a relatively low unemployment rate is helping to offset those trends.