The stock of Target (TGT 0.76%) has been rallying over the past month. Including today, the shares are up nearly 14% in the last 30 days. It jumped 6.2% as of 3:05 p.m. ET on Friday. Today's move came after the company announced a new store strategy and store design yesterday.
Target has been working on growing its digital sales channel for years. It acquired Shipt, a same-day delivery service, in 2017. That paid off when online sales using same-day services nearly doubled in 2019. The pandemic accelerated that growth even further with comparable digital sales soaring 145% in 2020 over 2019. That success has continued, and now Target has designed a new store format to help accommodate online shoppers even more.
Yesterday, it announced the debut of a larger store format to optimize additional space where customers can "browse the aisles, shop online or stop by for same-day services like Order Pickup and Drive Up," chief operating officer John Mulligan said in a statement.
The new store design will not be used everywhere, as the company continues to open stores of appropriate size for the local community. But the new larger footprint will be the focus for much of its growth and remodels in upcoming years, according to the retailer. The new stores are about 20,000 square feet larger than the average Target location.
Investors seemed to like the thought of leveraging what has been working while also modernizing new and remodeled stores. The company will report its third-quarter earnings next week on Nov. 16, when investors will see how the latest growth in its online shopping segment has been progressing.