Target released its initial fourth quarter earnings call but revealed a decrease in revenues and also lowered its forecast for the whole fiscal quarter of the year.
Things have not been going too good for the company. Despite the holiday period, Target registered quite a disappointing clients client traffic in its stores. And the winter shopping season did not come with the wished for earnings.
Target Corporation is a discount store retailer. It is based in Minneapolis, Minnesota. Founded in 1902, the company changed many brand names before settling on this one. It is the considered the second largest such retail chain. Walmart occupies the first position in the domain.
In the early 2010’s, the company experienced quite a revitalization. Its success grew as Target expanded in more areas. most were urban markets in the U.S.
Target operates over 1,800 stores throughout the nation. These include the Target discount stores and the SuperTarget hypermarkets.
On Wednesday, the company released its initial quarter earnings report. They were revealed on January 18. But were lower than expected.
The company’s total sales dropped by 4.9 percent. Their sale to CVS Health Corp is also believed to have contributed. Back in 2015, Target sold its retail medical clinics and pharmacies. The corporation had over 1,600 such facilities. And the effects of the sale are reportedly still being felt.
Target’s comparable sales also decreased in the November-December period. They marked a 1.3 percent drop. Comparable store transactions also fell by 1.7 percent.
According to company representatives, the transactions did not fare well. When compared to the same period in 2015, they fell flat.
However, Target did register a growth. Its digital transactions sector increased by 30 percent. Some consider that this growth offset the in-store transaction decline.
The retailer has a series of signature product categories. These include the toys sector. As these signature products registered a growth, other categories fell.
Target’s sale of food, electronics, and essential products reportedly fell as well. As did its entertainment sector.
After these preliminary quarter report, Target also adjusted its whole fourth quarter forecast. More exactly, the company lowered the estimated values.
Prior to the results, Q4 reports were in an estimated +/- 1 percent sales. Now, Target estimated that they would fall by 1 to 1.5 percent.
Its quarter share value also fell. The prior per share value ranged in between $1.55 to $1.75. Now, their value was estimated to be in between $1.45 to $1.55.
Following the quarter share adjustment, the company’s full-year value was also changed. Target had approximated a $5.10 to $5.30 per share value. Now, this was lowered to in between $5 to $5.10.
Following the fourth quarters earning preliminary report, the company shares fell. Their pre-market value registered a 3.9 drop. As such, the Target pre-market per share value was of $68.19.
Target is planning to release its final quarter results next month. More exactly, on February 28. Brian Cornell, the Target CEO, did release a statement.
According to him, he was pleased with the company’s Black Friday sales. And also with the online growth. All in all, this segment is said to have grown by over 40 percent. Target’s “signature” categories, which also include clothing, also reportedly continue being strong.
The company’s fourth-quarter earnings were also reportedly affected by two other facts. More exactly, Target’s efforts to shift towards the online services took their toll. And the highly competitive promotional environment could have also influenced the results.
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