24/7 Insights
- Target Corp. (NYSE: TGT) reported abysmal financial results after Walmart Inc. (NYSE: WMT) posted excellent ones.
- One analyst has an idea about why Target’s financial performance continues to be so poor.
Target Corp. (NYSE: TGT), the second-largest big-box retailer in the country after Walmart, posted abysmal financial results after Walmart Inc. (NYSE: WMT) posted excellent ones. The news drove its stock down almost 10%. Its share price is down 1% this year, while the S&P 500 is 12% higher. Walmart’s stock is up 24% since the start of the year and recently hit an all-time high.
The company also offered an earnings forecast that was short of expectations, another reason for the sell-off.
There was speculation about why Target’s financial performance continues to be poor. Storch Advisors CEO Jerry Storch told Yahoo! Finance, “Target years ago … made a strategic blunder to basically pull out of the full-service grocery business.” Walmart has the largest grocery business in America. There is a theory that people who shop for groceries at Walmart also often buy other merchandise.
Target’s most recent quarterly financials showed that comparable store sales dropped 3.7%, earnings declined from $2.06 per share to $2.04, and revenue was down 3.2% to $24.1 billion. Management said it hoped to do better.
Walmart’s U.S. comparable store sales rose 3.8% in the most recent quarter. U.S. revenue rose 4.6% to $108.7 billion, while operating income for the unit gained 7% to $5.2 billion.
Nothing Target management said gave investors any comfort.
20 Stores Like Target: Best Alternatives and Affordable Options
∴
Want to Retire Early? Start Here (Sponsor)
Want retirement to come a few years earlier than you’d planned? Or are you ready to retire now, but want an extra set of eyes on your finances?
Now you can speak with up to 3 financial experts in your area for FREE. By simply clicking here you can begin to match with financial professionals who can help you build your plan to retire early. And the best part? The first conversation with them is free.
Click here to match with up to 3 financial pros who would be excited to help you make financial decisions.
Have questions about retirement or personal finance? Email us at [email protected]!
By emailing your questions to 24/7 Wall St., you agree to have them published anonymously on a673b.bigscoots-temp.com.
By submitting your story, you understand and agree that we may use your story, or versions of it, in all media and platforms, including via third parties.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Latest from 24/7
