🐂 Not all bull runs are created equal. November’s AI picks include 5 stocks up +20% eachUnlock Stocks

Target Falls on Big EPS Miss, Analyst Says Results are 'Disappointing'

Published 17/08/2022, 14:00
© Reuters.
TGT
-

By Senad Karaahmetovic

Shares of Target (NYSE:TGT) are down nearly 3% after the retailer reported Q2 results that missed the average analyst estimate.

Target delivered an adjusted EPS of $0.39, a big miss compared to the consensus of $0.72. Sales came in at $25.65 billion, again lower than the estimate of $25.84 billion. The gross margin was reported at 21.5% while analysts were looking for 23.9%.

The company reiterated its prior view of full-year revenue growth coming "in the low- to mid-single digit range".

"While the company is planning cautiously for the remainder of the year, current trends support the company’s prior guidance for full-year revenue growth,” Target added.

A JPMorgan analyst commented that said results were “neutral”.

“Net-net, there are a number of cross currents in TGT’s release that we view positively although as we noted for LOW earlier there could be remnant topline risk in 2H. Indeed, comps were in-line and a little better than our previewed 2% bar but GM and EPS were much worse. We believe the right way to interpret that is that inventories are clean,” he said in a client note.

A Goldman Sachs analyst noted a Q2 miss, driven by weaker gross margins.

“We expect the stock to trade lower due to the 2Q miss (given two previous guide downs) and still elevated inventory, but note the positive top line trends including traffic growth and unit share gains along with reiterated guidance,” she wrote in a note.

For a Stifel analyst, the Q2 results were “disappointing”, although he is more positive on the guidance front.

“Maintained F2H guidance indicates the company expects a meaningful improvement in trends, and which we view as most notable and important for investors suggesting greater management visibility. We anticipate TGT shares are unlikely to move materially on the result.”

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.