{"id":12185,"date":"2023-08-16T11:35:16","date_gmt":"2023-08-16T11:35:16","guid":{"rendered":"https:\/\/isafespend.com\/investing\/targets-profit-boost-on-fewer-discounts-lifts-shares-outweighs-forecast-cuts\/"},"modified":"2023-08-16T11:35:17","modified_gmt":"2023-08-16T11:35:17","slug":"targets-profit-boost-on-fewer-discounts-lifts-shares-outweighs-forecast-cuts","status":"publish","type":"post","link":"https:\/\/isafespend.com\/?p=12185","title":{"rendered":"Target’s profit boost on fewer discounts lifts shares, outweighs forecast cuts"},"content":{"rendered":"
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\u00a9 Reuters. FILE PHOTO: A customer leaves one of the stores of discount retail chain Target in Ancaster, January 15, 2015. REUTERS\/Peter Power\/File Photo<\/span>
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By Ananya Mariam Rajesh<\/p>\n

(Reuters) -Target lowered its full-year sales and profit expectations even as its quarterly profit exceeded Wall Street estimates on Wednesday, benefiting from fewer discounts and better stocked store shelves.<\/p>\n

Shares of the big box retailer, which have fallen nearly 16% this year, surged about 8% in premarket trading as second-quarter inventory dropped and the company held back on steep discounts.<\/p>\n

Target, which largely sells non-essential items like electronics and home decor, has been trying to balance its merchandise by adding more daily-use products as consumers limit their spending to necessary items amid rising prices.<\/p>\n

Inventory fell 17% in the second quarter, with a 25% drop in discretionary items in its stock, Target said.<\/p>\n

“We are seeing food and beverage and household essentials absorbing a larger portion of the US consumers wallet,” Target CEO Brian Cornell said.<\/p>\n

“Guests are out at concerts, they are going to movies … they are enjoying those experiential moments and are shopping very carefully for discretionary goods.”<\/p>\n

As a result, the retailer’s quarterly revenue dropped 5% and it missed expectations. <\/p>\n

Sales also took a hit from the backlash against “adjustments” to its Pride merchandise, company executives said while promising to be careful with its partnerships while celebrating heritage moments.<\/p>\n

“As we navigate an ever-changing operating and social environment, we are applying what we learned,” Cornell said.<\/p>\n

Target now expects annual comparable sales to decline in the mid-single digit range compared to its prior forecast of low-single digit decline to a low-single digit increase.<\/p>\n

It expects 2023 adjusted profit per share between $7 to $8, compared with the prior range of $7.75 to $8.75.<\/p>\n

“(Results are) kind of a mixed bag … I think people were expecting probably a much worse second quarter,” Telsey Advisory Group analyst Joseph Feldman said.<\/p>\n

On an adjusted basis, Target earned $1.80 per share in the quarter ended July 29, beating expectations of $1.39. <\/p>\n

Bigger rival Walmart (NYSE:) is set to report earnings on Thursday.<\/p>\n<\/div>\n

Read the full article here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

\u00a9 Reuters. FILE PHOTO: A customer leaves one of the stores of discount retail chain Target in Ancaster, January 15, 2015. REUTERS\/Peter Power\/File Photo By Ananya Mariam Rajesh (Reuters) -Target lowered its full-year sales and profit expectations even as its quarterly profit exceeded Wall Street estimates on Wednesday, benefiting from fewer discounts and better stocked<\/p>\n","protected":false},"author":1,"featured_media":10405,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[49],"tags":[32],"class_list":{"0":"post-12185","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-investing","8":"tag-featured"},"yoast_head":"\nTarget's profit boost on fewer discounts lifts shares, outweighs forecast cuts | iSafeSpend<\/title>\n<meta name=\"description\" content=\"\u00a9 Reuters. 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