Target stock soared 20% to an all-time high of $103 after the consumer goods retailer posted exceptional second-quarter results.
Target’s (NYSE:TGT) second-quarter profits were up 17% to $938 million USD, while revenues saw an increase of 3.6% to $18.4 billionUSD. In-store sales were $18.1 billion USD, which is an increase of 3.4%. The standout figure in Target’s earnings report, however, was a rise in online sales of 34% compared to the same period last year. The company’s earnings per share also increased to $1.82 per share, about 21 cents better than Wall Street analysts were expecting, according to a survey by Zacks Investment Research.
Investors Flock to Target Stock
Off the back of today’s results, investors flocked to Target stock, which has had a bit of a tumultuous year amid escalating geopolitical tensions and fears that a recession is on the horizon. However, Target’s results went some way to appease these fears, as thriving consumer spending is the primary indicator of a healthy economic engine.
Today’s results also highlight the growing strength of mass retailers as they attempt to take on Amazon (NASDAQ:AMZN) for an increased share in the online market, and Target certainly isn’t doing a bad job of it.
Target CEO Brian Cornell said in a press release, “We are really pleased with our second-quarter performance, which demonstrates the strength of our strategy and the durable financial model we’ve built over the last several years. By appealing to shoppers through a compelling assortment, a suite of convenience-driven fulfillment options, competitive prices and an enjoyable shopping experience, we’re increasing Target’s relevancy and deepening the relationship between our guests and our brand.”
Stand Out Performers
Target stock joins another retail behemoth Home Depot (NYSE:HD) in seeing its share value jump off the back of posting Q2 earnings. It’s a positive indicator of the state of the economy despite fears that a recession is imminent, and has gone a long way to driving Wall Street confidence. This could be attributed to faith in both companies’ strategic models, as Target is currently in the process of spending $7 billion USD to update its stores and increase its online presence, as well as expanding its curbside pick-up service to increase consumer spending.
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