- Target’s 3Q adjusted EPS was $2.10, beating estimates of $1.47 and improving from $1.54 year-over-year.
- Comparable sales were down 4.9%, slightly better than the estimated 5.22% decline but a reversal from last year’s 2.7% growth.
- Comp digital sales fell by 6%, a drop from the previous year’s 0.3% growth but better than the estimated 10.3% decline.
- Sales amounted to $25.00 billion, down 4.3% from last year but exceeding the estimated $24.88 billion.
- Gross margin was at 27.4%, an improvement from last year’s 24.7% and beating estimates of 26.3%.
- Ebit was $1.34 billion, a 30% year-over-year increase.
- Ebitda was $2.06 billion, surpassing the estimated $1.67 billion.
- Customer transactions decreased by 4.1%, a downturn from last year’s 1.4% growth.
- Average transaction amount fell by 0.8%, a slight decline from last year’s 1.3% growth but better than the estimated 1.37% drop.
- Digital sales made up 16.8% of total sales, a slight decrease from last year’s 17.1%.
- The total number of stores was 1,956, a 0.8% increase from last year but slightly lower than the estimated 1,965.
- Operating margin was 5.2%, beating the estimated 3.94%.
- SG&A expenses were $5.32 billion, a 1.9% increase from last year but lower than the estimated $5.35 billion.
- Store comparable sales fell by 4.6%, less than the estimated 4.91% drop but a decline from last year’s 3.2% growth.
- Stores originated 83.2% of sales, a slight increase from last year’s 82.9% but lower than the estimated 83.4%.
- Operating income was $1.32 billion, a 29% increase from last year and significantly more than the estimated $1 billion.
- For the fourth quarter, Target forecasts an adjusted EPS of $1.90 to $2.60, with estimates at $2.23.
- Target is on track to invest nearly $5 billion in the business this year, focusing on team development, tools, technology, and capabilities to enhance guest experience.
- Inventory at the end of 3Q was 14% lower than last year, reflecting a 19% reduction in discretionary category inventory.
Target Corp on Smartkarma
Analysts at Smartkarma, an independent investment research network, have been closely monitoring Target Corp. In two recent research reports, Baptista Research gave a “Buy” rating and highlighted two major drivers. The first report noted that Target managed to exceed analyst expectations in terms of earnings despite delivering mixed results in the recent quarter. The second report highlighted that Target’s focus on building trust and delivering affordable products to consumers led to three consecutive years of traffic growth.
Overall, analysts at Smartkarma are bullish on Target Corp and have a revised target price for the company. As Target continues to adapt to the digital retail landscape, analysts will be keeping a close eye on the company’s performance in the coming quarters.
A look at Target Corp Smart Scores
| Factor | Score | Magnitude |
|---|---|---|
| Value | 2 | |
| Dividend | 3 | |
| Growth | 3 | |
| Resilience | 2 | |
| Momentum | 3 | |
| OVERALL SMART SCORE | 2.6 |
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 has a long-term outlook that looks promising, according to the Smartkarma Smart Scores. The company scored a 3 out of 5 for Dividend, Growth, and Momentum, indicating that it is likely to maintain a steady rate of growth and dividend payouts over the long-term. It scored a 2 out of 5 for Value and Resilience, suggesting that Target Corp may not be as immediately valuable as other companies, but its resilience will ensure that it can maintain its current level of performance over the long-term.
Target Corp is a general merchandise and food discount store chain, as well as an integrated online business. It also offers a branded proprietary credit card to qualified applicants. With its strong scores in Dividend, Growth, and Momentum, Target Corp has the potential to provide a steady rate of growth and dividend payouts over the long-term, making it a great long-term investment.
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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