Despite Earnings Beat, Target Faces Challenges Going Forward

-22.13%
Downside
177
Market
138
Trefis
TGT: Target logo
TGT
Target

Target (NYSE:TGT) announced mixed results for the first quarter on Wednesday. The company reported revenues of $16.2 billion during the quarter, which missed Reuters’ compiled consensus estimates by roughly $120 million and were also short of the $17.1 billion reported last year. The sales decline of 5.4% was Target’s slowest growth since 2014. Target still managed to report adjusted earnings of $1.29 per share in the first quarter, more than 16% ahead of the $1.10 reported in the prior year quarter and easily beating the higher end of its own guidance.

Comparable-store sales increased 1.2% in this quarter but the gain was more than offset by sale of its pharmacy business to CVS last year.  Though digital sales have risen as compared to last year, retailers are still struggling to improve foot traffic to boost their net sales.

tgtearnings1

Relevant Articles
  1. Down 28% This Year Will Target Stock Rebound Past Q3?
  2. Will Target Stock Return To Pre-Inflation Shock Highs?
  3. Target’s Stock Is Down 20% This Year, What’s Next?
  4. Target Stock To Likely Trade Higher Post Q1 Results
  5. What’s Next For Target Stock After A 32% Fall In The Last Year?
  6. Company Of The Day: Target

 

tgtearnings5

Target also announced guidance for the second quarter that was lower than what analysts were expecting due to a slowdown in consumer demand.

tgtearnings6

Notes:

1) The purpose of these analyses is to help readers focus on a few important things. We hope such lean communication sparks thinking, and encourages readers to comment and ask questions on the comment section, or email content@trefis.com
2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively. For precise figures, please refer to our complete analysis for Target
Interactive Institutional Research (Powered by Trefis):

Global Large CapU.S. Mid & Small CapEuropean Large & Mid Cap |More Trefis Research