Target stock price hits two-year low coinciding with boycott over bathroom policy

The stock value of Target Corporation has seen its biggest price drop in two years, coinciding with the conservative boycott over its controversial transgender bathroom policy.

On Tuesday, Target shares sank 12.1 percent to $58.79, and it projected first-quarter profit below Wall Street estimates, according to Reuters. While the company saw its online operations growing, it reported its third straight quarter of lower sales from existing stores. Brian Cornell, chairman and CEO of the discount retail giant, said that there has been an "unexpected softness" at its stores.

In April 2016, Target announced that it would allow its customers and employees to use restrooms that correspond to their gender identity. Following the announcement, conservative groups, such as 2nd Vote and the American Family Association (AFA), campaigned heavily to encourage families to shop elsewhere.

The groups argued that Target's bathroom policy would leave women and girls exposed to the dangers of sexual predators.

2ndVote Executive Director Lance Wray said that the company is "pushing a radical agenda over common-sense and safety." Target, however, maintained that its bathroom policy is aimed at helping people feel comfortable.

A report from Snopes has contended that the drop in Target's stock price was not caused by the boycott and that it was due to the 2017 guidance announced at an investor day event.

While Wall Street expected the company to project earnings of $5.30 per share, Target gave guidance of $3.80 to $4.20 per share, according to Edward Jones analyst Brian Yarbough. The guidance was "well below" expectations, resulting in the drop in share value.

In an email to Snopes, company spokeswoman Erika Winkels maintained that the bathroom policy had no effect on its business.

"We have made it clear over time that we've seen no material impact to the business based on the bathroom policy. We don't have anything new or different to share," Winkels wrote.

Shortly after the company announced the bathroom policy change, a report from USA Today, indicated that the percentage of people who would consider shopping at Target the next time they needed something dropped from 42 to 38 percent. YouGov CEO Ted Marzilli described the drop as a "significant" shift, but he insisted that the backlash against Target's position is not "catastrophic."

During a meeting with analysts and investors, Target vowed aggressive promotions and asserted that it will eventually win back market share by investing in technology and small stores.