Target Corporation (NYSE: TGT) investors may not have had the best year in 2017, but the company at least ended the year on a high note. On Tuesday, Target pre-reported robust holiday sales and raised its fourth-quarter earnings guidance.
After reporting just 0.9 percent same-store sales growth in the third quarter, Target says it expects fourth-quarter same-store sales to rise 3.4 percent. Target had previously guided for 0 to 2 percent same-store sales growth in the holiday quarter. The company also expects to report full-year 2017 same-store sales growth of 1 percent.
On the earnings front, Target has raised its fourth-quarter earnings-per-share guidance from a previous range between $1.05 and $1.25 to a new range between $1.30 and $1.40. Wall Street analysts had expected $1.22.
The company also raised its full-year 2017 EPS guidance from a previous range between $4.40 and $4.60 to a new range between $4.64 and $4.74. Consensus estimates called for $4.56. Target also issued 2018 EPS guidance between $5.15 and $5.45.
Target expects full-year 2017 online sales to increase 25 percent. In the third quarter, online sales accounted for only 4.3 percent of Target’s total sales. Target says 70 percent of its digital sales volume in the fourth quarter was fulfilled at its brick-and-mortar stores, indicating the strength of both its online and physical presence.
Earlier this year, Target told shareholders it would invest $7 billion in initiatives to increase its private-label offerings, remodel its stores and beef up its online business. On Tuesday, CEO Brian Cornell said investors can expect those trends to continue in 2018.
“As we look ahead to 2018, we will build on the foundation we established this year by launching additional exclusive brands, enhancing our digital capabilities, opening approximately 30 small-format stores and tripling the size of our remodel program to more than 325 stores,” Cornell said.
If the fourth quarter is any indication, Target seems to be gaining some traction in a difficult U.S. grocery environment. Target stock may also get a boost from the rumor mill as well. Earlier this month, Loup Ventures analyst Gene Munster said…
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