Target Corporation just released its first quarter earnings yesterday, May 22nd which missed expectations as a result of soft sales in seasonal and weather-related categories. Target had first-quarter revenues of $16.71 billion, consensus was at $16.78 billion, which is down 1.0% for the year. Net earnings fell 28.5% to $498 million, with diluted earnings falling 26% to $0.77 per share. GAAP adjusted earnings per share were at $1.05, down 5% from last year’s outstanding performance. Earnings came in short of consensus estimates of $0.84 per share. Targets gross margins increased 30.7% due to changed vendor agreements and the company’s growth strategies. Target also opened its first 24 Canadian stores in this first quarter and plans to open 124 stores in Canada by the end of its fiscal year. Target’s mobile traffic and sales continue to grow at a triple-digit pace, with mobile traffic representing more than 30% of our digital traffic in the first quarter. A major one-time factor that impacted earnings was loss related to the early retirement of debt of 41 cents per share. During the earnings call Targets CEO and chairman, Gregg Steinhafel stated, “While we are disappointing in or first quarter performance, we remain confident in our strategy, and we continue to invest in initiatives, including Canada, our digital channels and CityTarget, that will drive Target's long-term growth." For the second quarter the company expects adjusted EPS of $1.09 to $1.19 and GAAP EPS of $0.90 to $1.00. Full-year adjusted earnings are expected to come in between $4.70 and $4.90 per share, a 15 cent reduction from Target's previous guidance. GAAP earnings are expected to come in between $4.12 and $4.32 per share. Factoring in a 4% fall in Wednesday's trading session, the market values Target at $44.0 billion. This values the company at merely 0.6 times annual revenues and 15 times last year's earnings. Target currently pays a quarterly dividend of $0.36 per share, for an annual dividend yield of 2.1%. One poor and expected quarter should not be of concern to us, target has seen steady long-term growth in the past and I expect it to continue on this path in the future.
Thursday, May 23, 2013
Target 1Q Earnings
Target Corporation just released its first quarter earnings yesterday, May 22nd which missed expectations as a result of soft sales in seasonal and weather-related categories. Target had first-quarter revenues of $16.71 billion, consensus was at $16.78 billion, which is down 1.0% for the year. Net earnings fell 28.5% to $498 million, with diluted earnings falling 26% to $0.77 per share. GAAP adjusted earnings per share were at $1.05, down 5% from last year’s outstanding performance. Earnings came in short of consensus estimates of $0.84 per share. Targets gross margins increased 30.7% due to changed vendor agreements and the company’s growth strategies. Target also opened its first 24 Canadian stores in this first quarter and plans to open 124 stores in Canada by the end of its fiscal year. Target’s mobile traffic and sales continue to grow at a triple-digit pace, with mobile traffic representing more than 30% of our digital traffic in the first quarter. A major one-time factor that impacted earnings was loss related to the early retirement of debt of 41 cents per share. During the earnings call Targets CEO and chairman, Gregg Steinhafel stated, “While we are disappointing in or first quarter performance, we remain confident in our strategy, and we continue to invest in initiatives, including Canada, our digital channels and CityTarget, that will drive Target's long-term growth." For the second quarter the company expects adjusted EPS of $1.09 to $1.19 and GAAP EPS of $0.90 to $1.00. Full-year adjusted earnings are expected to come in between $4.70 and $4.90 per share, a 15 cent reduction from Target's previous guidance. GAAP earnings are expected to come in between $4.12 and $4.32 per share. Factoring in a 4% fall in Wednesday's trading session, the market values Target at $44.0 billion. This values the company at merely 0.6 times annual revenues and 15 times last year's earnings. Target currently pays a quarterly dividend of $0.36 per share, for an annual dividend yield of 2.1%. One poor and expected quarter should not be of concern to us, target has seen steady long-term growth in the past and I expect it to continue on this path in the future.
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