Categories Earnings, Retail

Target shares plunge 7% after Q3 earnings miss

Target Corp (TGT) stock plunged 7% after missing earnings estimate in the third quarter. Net income rose 20% to $1.09 cents per share, lower than the average analysts’ estimate of $1.11 per share. Higher investments to improve supply chain efficiency hurt Target’s margins during the quarter.

On a GAAP basis, net income rose to $1.17 per share, compared to $0.87 per share during the same period last year.

Target third quarter 2018 Earnings Infographic

The company reported 5.1% growth in comp sales driven by healthy increases in both store and digital channels. However, this came slightly below the Street consensus of 5.2%. Thanks to the increasing investments in the digital platform, comparable online sales jumped 49% in Q3.

Revenue of the department store chain rose 5.6% to $17.8 billion. Analysts had expected revenue of $17.75 billion during the quarter.

Target CEO Brian Cornell said, “We’ve made significant investments in our team heading into the holidays and they are ready to serve our guests with a comprehensive suite of convenient delivery and pickup options, a wide range of new products and unique gift ideas and a strong emphasis on low prices and great value.”

Why Target is a better investment than Walmart this holiday season

Despite the earnings miss, Target remains optimistic about the holiday quarter, when it anticipates comp sales growth of about 5%. The company also reiterated its guidance for full-year adjusted EPS between $5.30 and $5.50.

Target shares have increased 15% so far this year.

During the prior-sequential quarter (Q2), a 6.4% jump in store traffic had driven Target’s top line higher by 7%. Earnings grew 19% riding on the sales growth and lower income taxes. The results had also benefited from various merchandising strategies including cost-savings initiatives and efforts to improve pricing and promotions.

 

Get access to timely and accurate verbatim transcripts that are published within hours of the event.

Most Popular

Key highlights from Autodesk (ADSK) Q4 2021 earnings results

Autodesk, Inc. (NASDAQ: ADSK) today reported its fourth quarter financial results for the period ended January 31, 2021. Net income for the fourth quarter was $911.3 million, or $4.10 per

Infographic: Beyond Meat (BYND) reports wider Q4 loss; Revenue up 4%

Beyond Meat (NASDAQ: BYND), a specialist in plant-based meat substitutes, Thursday reported a wider loss for the fourth quarter, despite an increase in revenues. The numbers also missed the consensus

Virgin Galactic stock tanks on delayed test flight

Virgin Galactic (NYSE: SPCE) reported fourth-quarter 2020 financial results after the regular market hours on Thursday. The space tourism company reported zero revenue in the fourth quarter, compared to $529,000

Add Comment
Loading...
Cancel
Viewing Highlight
Loading...
Highlight
Close
Top