- Target has narrowed its full-year adjusted EPS forecast to between $7 and $8, down from a previous range of $7 to $9. The market estimate was $7.29.
- Comparable sales for the third quarter declined by 2.7%, compared to a 0.3% increase the same quarter last year. Estimates foresaw a 2.06% decline.
- Digital sales grew by 2.4%, significantly lower compared to the 10.8% increase from the previous year. The expected growth was 3.43%.
- Net sales totaled $25.27 billion, slightly missing the $25.33 billion estimate.
- Gross margin was recorded at 28.2%.
- Earnings before interest and taxes (Ebit) fell by 19% year-over-year to $974 million.
- Earnings before interest, taxes, depreciation, and amortization (Ebitda) declined by 10% year-over-year to $1.75 billion, below the estimate of $1.89 billion.
- Customer transactions decreased by 2.2%, a drop from the 2.4% increase observed last year.
- The average transaction amount decreased by 0.5%, better than the estimated 0.79% decline.
- Digital sales now account for 19.3% of total sales, compared to 18.5% last year.
- Total store count rose to 1,995, a 0.9% increase from the previous year, slightly above the estimate of 1,988 stores.
- The operating margin contracted to 3.8%, down from 4.6% the previous year, and below the expected 4.34%.
- SG&A expenses reached $5.54 billion, a 1.4% increase year-over-year, exceeding the estimate of $5.48 billion.
- Store comparable sales saw a decrease of 3.8% compared to a 1.9% drop the previous year and an estimated decline of 3.33%.
- Stores originated 80.7% of sales, slightly decreasing from 81.5% last year but above the 80.4% estimate.
- Adjusted EPS for the quarter was $1.78, down from $1.85 the previous year but above the anticipated $1.73.
- Operating income fell by 19% year-over-year to $948 million, underperforming relative to the $1.12 billion estimate.
- Full-year GAAP EPS is projected to be between $7.70 and $8.70.
- Target maintains its expectation for a low-single digit decline in sales for the fourth quarter of 2025.
Target Corp on Smartkarma
Analyst coverage of Target Corp on Smartkarma by Baptista Research delves into the company’s strategic moves and performance amid market transitions. In their report “Target’s Big Partnerships: Will Starbucks, Disney, & Apple Help Fuel Their Much Needed Turnaround?“, the analysts focus on the impact of key partnerships on Target’s turnaround. Highlighting the leadership transition with Michael Fiddelke becoming the next CEO, the report provides insights into the company’s current performance and future direction, with a bullish outlook.
In another report by Baptista Research titled “Target Corporation: Will Its Investments in Digital Fulfillment and Supply Chain Pay Off?”, analysis of Target’s challenging conditions in the first quarter of 2025 is presented. The detailed examination of quarterly results showcases a mix of positive aspects, setbacks, and strategic adjustments, offering investors valuable insights. Despite a decline in sales, the report maintains a bullish sentiment, suggesting optimism regarding Target’s investments in digital fulfillment and supply chain.
A look at Target Corp Smart Scores
| Factor | Score | Magnitude |
|---|---|---|
| Value | 3 | |
| Dividend | 4 | |
| Growth | 3 | |
| Resilience | 3 | |
| Momentum | 3 | |
| OVERALL SMART SCORE | 3.2 |
Smart Score is a compound score for the Company indicating its overall outlook. It is derived by taking an equally weighted average of underlying Factor scores computed by Smartkarma
Target Corp, a leading general merchandise discount store operator, appears to have a steady long-term outlook based on its Smartkarma Smart Scores. With respectable scores in Value, Dividend, Growth, Resilience, and Momentum, the company seems to be positioned well across various key factors. The scores suggest that Target is maintaining a good balance between value, growth potential, and dividend payouts, demonstrating resilience and momentum in its operations.
Target Corporation operates general merchandise discount stores, offering a wide range of products to consumers both in-store and online. The company’s emphasis on providing a mix of merchandise combined with growing its online presence and credit offerings through proprietary cards indicates a diversified approach to capturing market share and customer loyalty. Overall, Target’s Smart Scores paint a positive picture for its future prospects and underline its ability to navigate through changing market dynamics while fulfilling customer demands.
Disclaimer: This article by Smartkarma is general in nature and based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Note that our articles may not factor in the latest price-sensitive company announcements or qualitative material.
While all reasonable care has been taken in the preparation, Smartkarma makes no assurance about the accuracy of any generated data or content. All content is indicative only and should be independently checked for accuracy and confirmed before use. Smartkarma accepts no responsibility for any loss or damage caused as a result of any inaccuracy or error within the Lab online tools or generated data.
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