Target is under new pressure from activist investor Toms Capital Investment Management (TCIM), which recently took a stake in the struggling retailer, intensifying scrutiny on the company as it faces falling sales and growing investor concerns.
The size of TCIM's investment was not disclosed, and the firm has not shared specific demands.
Target's shares rose 2.6% following the news, offering a small boost amid a year in which the stock has lost more than 28% of its value, US News reported.
The Minneapolis-based retailer has reported three straight quarters of declining comparable sales, a sign that it is struggling to keep pace with competitors.
In August, Target named veteran executive Michael Fiddelke as its incoming CEO, set to assume the role in February.
He will continue reporting to current CEO Brian Cornell, who will move to executive chairman, a structure that has already drawn criticism.
Nonprofit shareholder activist group The Accountability Board filed a proposal in October urging the company to appoint an independent chairman.
"To us, this signals that investors are hungry for change, and means our shareholder proposal likely has an even stronger chance of passing," said Matt Prescott, president of the Accountability Board.
Embattled Target feeling heat from hedge fund investor Toms Capital following sales slump https://t.co/IJdHjZ9pRm pic.twitter.com/wT7p99W6Nz
— New York Post (@nypost) December 26, 2025
Target Faces New Hedge Fund Pressure
TCIM, a relatively unknown hedge fund in the retail world, has recently gained attention for taking stakes in companies like Tylenol maker Kenvue, Pringles maker Kellanova, and US Steel.
Its involvement marks Fiddelke's first major test ahead of his CEO tenure.
Target said in a statement, "We maintain a regular dialogue with the investment community. Target's top priority is getting back to growth." TCIM did not respond to requests for comment.
According to Reuters, to regain momentum, Target has announced plans to invest an additional $1 billion in 2026 to open new stores and remodel existing locations.
The company also cut 1,800 corporate roles as part of a broader restructuring.
Analysts note that focusing on retail fundamentals—including product offerings, pricing, and store experience—remains crucial.
Neil Saunders, managing director at GlobalData, emphasized that short-term financial moves, like monetizing real estate, are unlikely to deliver lasting results.
Target's encounters with activist investors are not new. In 2009, Pershing Square's Bill Ackman attempted a high-profile proxy battle seeking board seats to push a real-estate spin-off, but shareholders rejected the plan.
Currently, Target owns about 75% of its real estate, according to UBS analyst Michael Lasser.
Originally published on vcpost.com
