Target (NYSE:$TGT) reported revenue, same-store sales, and earnings on Wednesday, August 16. Thanks to an increase in online transactions, Target surpassed analysts’ expectations for the second quarter.
Contrary to popular belief, there are more shoppers returning to physical stores and making purchases on Target.com. Therefore, the discount retailer made the decision to increase its outlook for the full-year, as it appears the company’s turnaround efforts are making significant progress.
Let’s take a look at what Target reported for the second quarter versus what Wall Street was forecasting, based on a Thomson Reuters survey:
- Earnings: $1.23 a share, adjusted, compared with a forecast profit of $1.19 per share
- Revenue: $16.43 billion versus an estimate of $16.30 billion
- Same-store sales increased 1.3%, which is better than the forecast 0.7% growth
“We are pleased that second-quarter traffic increased more than 2 percent, reflecting growth in both our store and digital channels,” CEO Brian Cornell said.
“We continue to focus on our long-term strategy… While our recent results are encouraging, we will continue to plan prudently as we invest in building our brands, our digital channel, the value we provide our guests and elevating service levels in our stores.”
Target’s Earnings Report: Quick Facts
– Second quarter revenue climbed 1.6% from 2016, to $16.43 billion
– Net income dropped to $672 in the second quarter
– Sales from Target stores that have been open more than 12 months increased 1.3%
– Comparable digital sales increased 32%
“While we believe Target has much further to go before the grocery business is fully fixed, we applaud the start it has made in turning around this challenging part of the operation,” Neil Saunders wrote in a note to clients.
Moving forward, Target made the decision to update its outlook for Q3, now expecting to earn between the range of 75 cents and 95 cents a share. According to Thomson Reuters, analysts were forecasting Q3 earnings per share to be 77 cents.
In regards to the full year, Target expects earnings between the range of $4.34 to $4.54 per share. Analysts surveyed by Thomson Reuters had forecast earnings to be $4.39 in 2017.
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