From Barchart: 2024-11-21 06:28:00

Target (NYSE:TGT) shares plummeted 21% after missing Q3 earnings expectations and providing weak guidance for the fiscal year. Adjusted EPS was $1.85, below the $2.30 estimate, with revenue at $25.67 billion, missing the $25.87 billion estimate. Comparable sales rose 0.3%, driven by a traffic increase but offset by lower transaction values.

Full-year guidance disappointed, with Target forecasting EPS between $8.30 and $8.90 for fiscal 2025, well below the $9.52 analysts expected. Q4 projections include flat comparable sales and adjusted EPS of $1.85 to $2.45. Despite growth in digital sales and certain categories, cost pressures impacted margins.

Strength in digital sales and certain categories couldn’t offset cost pressures for Target, leading to a decline in gross margin rate to 27.2% and operating margin to 4.6% from 5.2% a year earlier. Higher expenses for digital fulfillment and supply chain, due to increased inventory levels and new facilities, weighed on profitability.



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