Target Corporation (NYSE: TGT)
Target stock jumped 5.85% in premarket trading on Wednesday, after the retailer posted its strongest store traffic and comparable sales growth in more than a decade.
The company appears to be benefitting significantly from a multibillion-dollar reinvestment plan that was implemented by Chief Executive Brian Cornel two years ago.
Last year, it acquired Shipt Inc. for $500 million, in a move aimed at competing with rivals such as Amazon, Walmart, and Kroger.
It has also started selling exclusive items, revised its pricing strategy, and set up small stores in urban areas.
Target shares have gained nearly 28% year-to-date, and 47% year-over-year.
TGT Earnings & Outlook
The company reported fiscal second-quarter net income of $799 million, or $1.549 a share, compared with net income of $671 million, or $1.22 a share, in the year-ago quarter.
Adjusted earnings were $1.47 per share. Net sales came in at $17.55 billion, up 7.0% from the same period last year.
Analysts polled by Thompson Reuters expected the company to post adjusted earnings of $1.40 per share on sales of $17.28 billion. Same-store sales increased 6.5%, thanks to increased traffic at its stores.
For the current quarter, Target expects its earnings to be in the range of $1.00 to $1.20 per share. The company also raised its full-year per-share earnings guidance from $5.15 and $5.45 to $5.30 to $5.50.
Target CEO Comments
Commenting on the results, Cornel said, “We are extremely pleased with Target’s second quarter results, which demonstrate our guests’ excitement for the enhanced and differentiated shopping experience we’re building. For the second consecutive quarter, traffic growth is better than we’ve seen in well over 10 years, driving 6.5 percent comp growth – Target’s best in 13 years.”
The CEO continued, “We laid out a clear strategy at the beginning of 2017, and throughout this year we’ve been accelerating the pace of execution. We’re on track to deliver a strong back half and we’ve updated our full year guidance to reflect the strength of our business and the consumer economy. As we look ahead to 2019, we expect to achieve scale across the full slate of our initiatives – creating efficiencies and cost-savings, further strengthening our guest experience and positioning Target to continue gaining market share.”
Target Corporation Company Profile
Target Corporation operates as a general merchandise retailer in the United States. The company offers beauty and household essentials, food and beverage products, and apparel for women, jewelry, accessories, and shoes.
It also provides home furnishings and décor comprising furniture, lighting, kitchenware, small appliances, home décor, bed and bath products, home improvement products, automotive products, and electronics.
In addition, the company offers in-store amenities, which comprise Target Café, Target Optical, Starbucks, and other food service offerings. It sells its products through its stores; and digital channels, including Target.com.
As of March 8, 2018, the company operated 1,826 stores. Target Corporation was founded in 1902 and is headquartered in Minneapolis, Minnesota. –Yahoo