Target Corp. (NYSE: TGT) reported first-quarter 2018 results before markets opened Wednesday. The big-box retailer posted adjusted earnings per share (EPS) of $1.32 and $16.78 billion in revenues. In the same period a year ago, it reported EPS of $1.04 on revenue of $16.0 billion. First-quarter results also compare to consensus estimates for EPS of $1.38 and $16.5 billion in revenue.

Same-store sales rose 3% compared with the first quarter of 2017. Digital channel sales rose 28% and contributed 1.1 points to same-store sales growth. Store traffic rose 3.7% in the quarter, the best growth in more than 10 years. Operating income, however, dipped nearly 10% from $1.16 billion last year to $1.04 billion.

The EPS miss is killing the stock price this morning, and revenue, although it beat both last year’s quarterly total and the consensus estimate, cleared a low bar.

In its outlook for the second quarter of 2018, Target said it expects same-store sales growth to accelerate into the low to mid-single-digit range. For the quarter, the company expects adjusted EPS of $1.30 to $1.50. For all of 2018, adjusted EPS is forecast in a range of $5.15 to $5.45 and same-store sales are projected to rise by low single-digits.

Analysts had forecast EPS for the second fiscal quarter at $1.35 on revenues of $16.78 billion. For the full year, analysts are looking for EPS of $5.28 and revenues of $72.5 billion. Target’s own guidance offers no significant improvement to the consensus outlook.

Brian Cornell, Target’s CEO, said:

We’re very pleased that our business continued to generate strong traffic and sales growth in the first quarter, as we made significant progress in support of our long-term strategic initiatives. … Strong sales growth in our home, essentials and food & beverage categories offset the impact of delayed sales in temperature-sensitive categories, which accelerated rapidly in recent weeks as weather improved across the country. … [W]e expect Target’s second quarter comparable sales growth will move into the low to mid single-digit range, and the midpoint of our second quarter EPS guidance represents approximately 15 percent growth over last year.

The company’s initiatives in e-commerce and delivery service, as well as another pay hike (to $12 an hour) for employees, have squeezed profits. With investors looking for returns and Target doling cash out instead to employees and investments in growth, it’s no wonder the shares are getting hit this morning.

Target’s shares traded down nearly 6% in Wednesday’s premarket, at $70.96 in a 52-week range of $48.56 to $78.70. The consensus 12-month price target was $76.12 before results were announced.

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