A Target store is seen in Manhattan, New York City on March 5, 2024.
Spencer Pratt | Getty Images
target The company is due to report quarterly results on Wednesday as it seeks to bounce back from a long period of sluggish sales and profits.
According to an LSEG analyst survey, Wall Street has the following expectations for the Minneapolis-based retailer:
Earnings per share: $2.18 Revenue: $25.21 billion
Known for offering a wide range of on-trend, low-priced goods, Target has been hurt by consumers buying fewer discretionary items like new clothes and home decor, while spending more on everyday items like food and housing. The company’s same-store sales have fallen for the past four quarters. This industry measure, also known as same-store sales, excludes the impact of one-time events like store openings and closings.
But Target executives said in May that the company expected to return to sales growth in the second quarter. For the full year, Target projected comparable sales to be flat to up 2 percent and adjusted earnings per share to be $8.60 to $9.60.
Target has been moving to boost sales and attract more customers. In May, the company said it would lower prices on about 5,000 commonly purchased items, including diapers, milk and paper towels. The company relaunched its loyalty program earlier this year and introduced a new paid membership called Target Circle 360, which includes perks like free same-day delivery. Target also held its own sales event in July to compete with other supermarkets. AmazonPrime Day.
Back to school is also a big season for retailers, as it’s the time when families buy new shoes, clothes, backpacks, notebooks and more.
Other indicators bode well for Target: Consumer spending came in stronger than expected in July, with advance retail sales up 1% from the previous month, according to the Commerce Department.
Competition from big box stores Walmart The company beat Wall Street forecasts for the quarter last week, blunting concerns about deteriorating consumer health, with Chief Financial Officer John David Rainey telling CNBC that customers “remain selective and discriminating.” [and] He added that it is “value-driven” but “will not come at the further expense of consumer health.”
But Target’s sales mix is different from Walmart’s: Grocery accounts for just 23% of Target’s sales, compared with roughly 60% of Walmart’s U.S. business, according to the companies’ most recent annual reports.
What’s more, Walmart’s quarterly results could pose a threat to Target: On the company’s earnings call last week, Rainey said much of Walmart’s market share gains come from higher-income households, the type of customers who choose Walmart’s stores and websites over other retailers, including Target.
Target shares closed at $144.33 on Tuesday. As of Tuesday’s close, the company’s shares were up about 1% so far this year, slower than the S&P 500’s gain of about 17% over the same period.
