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Target Corporation shares plummeted nearly 25% after the giant Minneapolis-based retailer posted fiscal Q1 earnings that came short of the analyst estimates.
Source: Target
TGT down -25.22%, WMT down -3.68%
The company’s earned $2.16 per share, way below the $4.17 earned in the year-earlier quarter. Revenue jumped 4% to $25.17 billion from $24.2 billion.
Comparable-store sales rose 3.3%, higher than the estimate of a 0.9% jump by the FactSet survey. The higher sales reflected popular purchased categories, including food and beverage, beauty products, and household essentials.
Target’s gross-profit margin contracted in the quarter to 25.7% from 30% in the year-earlier quarter, signaling higher markdowns.
Brian Cornell, Chairman and Chief Executive of Target, stated that despite the high costs, the resulting profitability came in well below expectations and well below where they expect to operate over time.
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