Target completes US$10B share repurchase program initiated in November 2007, says it expects its annual dividend to reach US$3 per share by 2017

Cindy Allen

MINNEAPOLIS , March 19, 2012 (press release) – Target Corporation (NYSE: TGT - News) today announced that, as expected, it has completed the $10 billion share repurchase program authorized by its board of directors in November 2007. Under the program, the company repurchased 193.5 million shares, representing nearly 23 percent of its November 2007 outstanding shares, at an average price of $51.68 per share.

Target will continue to repurchase shares under the $5 billion program approved by its board of directors in January, 2012, which it expects to complete in the next 2 to 3 years.

“Target’s completion of the 2007 share repurchase program demonstrates our long-standing commitment to return cash to shareholders through both dividends and share repurchase,” said John Mulligan, incoming EVP and chief financial officer of Target Corporation. “Through disciplined financial management, Target continues to generate far more cash than we need to fund appropriate reinvestment in our core businesses. As a result, we intend to continue to invest in the repurchase of shares under our January 2012 authorization.”

Priorities for Dividends and Share Repurchase

Dividends represent the foundation of Target’s strategy to return cash to its shareholders. The company has paid a dividend every quarter since it became a public company in 1967, and in 2011 the company marked its 40th consecutive year of annual dividend increases. Over the last 5 years, Target Corporation’s dividend has grown much faster than earnings per share, reflecting a slower pace of capital expenditures along with robust generation of cash from operations. The company expects to continue to grow the dividend at a robust pace which would allow the annual dividend to rise to $3.00 or more by 2017, assuming the company meets its goal to grow annual earnings per share to $8.00 or more by that time.

Share repurchase represents an opportunity to apply excess cash flow to what the company believes will be an attractive long-term investment, and the company intends to continue to govern its pace of execution of share repurchase to maintain strong investment-grade credit ratings. The company believes this investment will prove to be especially valuable if it is able to achieve its long-term EPS growth objectives.

In 2011, a year in which capital investment was elevated to support the company’s expected 2013 Canadian market launch, the company invested almost $1.9 billion in share repurchase, retiring more than 5% of shares outstanding at the beginning of the year. In 2012, with continued investment in support of the Canadian market launch, the company expects to invest another $1.5 billion or more in share repurchase. Over time the pace of share repurchase execution will likely increase, as annual capital expenditures are expected to moderate following the launch of Target stores in Canada.

Forward-Looking Statements

Statements in this release regarding expected dividends, share repurchase, earnings per share, share price, cash flow and capital expenditures are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements speak only as of the date they are made and are subject to risks and uncertainties which could cause the company's actual results to differ materially. The most important risks and uncertainties are described in Item 1A of the company's Form 10-K for the fiscal year ended January 28, 2012.

About Target

Minneapolis-based Target Corporation (NYSE:TGT - News) serves guests at 1,765 stores across the United States and at Target.com. The company plans to open its first stores in Canada in 2013. In addition, the company operates a credit card segment that offers branded proprietary credit card products. Since 1946, Target has given 5 percent of its income through community grants and programs; today, that giving equals more than $3 million a week. For more information about Target’s commitment to corporate responsibility, visit Target.com/hereforgood.

For more information, visit Target.com/Pressroom.

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