Target Investors to Seek Clues on Holiday Plans -- Earnings Preview
14 November 2017 - 10:59PM
Dow Jones News
By Khadeeja Safdar
Target Corp. is scheduled to report fiscal third-quarter results
before the market opens on Wednesday. Here is what you need to
know:
EARNINGS FORECAST: Analysts polled by FactSet expect adjusted
earnings of 86 cents a share, compared with $1.04 a share a year
earlier.
REVENUE FORECAST: Target is expected to report revenue of $16.59
billion, up from $16.44 billion a year ago.
WHAT TO WATCH:
HOLIDAY PLANS: Target has been making headway on its plan to
spend $7 billion on store and digital improvements, pulling itself
out of a yearlong sales slump. But the real test will be the
holiday-shopping period. After a weak season last year, the company
has improved its ship-from-store capabilities, remodeled locations,
launched new brands and changed its promotional strategy in hopes
of driving more sales. Expect to hear more about Target's plans for
the coming holiday period when it reports earnings.
PRICING: Target lowered prices this year on thousands of
household items, a move that helped lift store sales and shrunk the
gap in prices between it and Wal-Mart Stores Inc., according to
research firm Gordon Haskett. This holiday season, executives plan
to cut back on some promotions, focusing on fewer and more
effective discounts.
STORE TRAFFIC: Is Target continuing to see foot traffic
improving at its brick-and-mortar locations? Chief Executive Brian
Cornell has said that sales rose 2% to 4% at stores it recently
renovated, and last month the retailer said it plans to make over
more than 1,000 stores by 2020, up from a previous estimate of 600
stores. The company hasn't said how this expanded plan would affect
spending, and investors will be looking for clarification.
E-COMMERCE: Target has to strike a balance between improving its
e-commerce capabilities and getting shoppers in its physical
stores, something Wal-Mart is attempting to do by raising some
prices on its site. Target's online strategy has included raising
the minimum order for free shipping and encouraging shoppers to
place bigger orders by rolling out a service in which customers can
fill a box with merchandise for a flat fee. It may have other plans
to discuss, or questions from analysts, when it comes to digital
initiatives.
Write to Khadeeja Safdar at khadeeja.safdar@wsj.com
(END) Dow Jones Newswires
November 14, 2017 06:44 ET (11:44 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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