Retail therapy

28 February 2017 By Jennifer Saba Follow @jennifersaba

The U.S. retailer reported unexpected top-line weakness and forecast more pain, wiping $5 bln from its market value. Pressure from the likes of Wal-Mart is hurting. A 34 pct jump in online sales is encouraging, but Target will continue to struggle with changing shopping habits.

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Target on Feb. 28 forecast a low-single-digit decline in comparable sales for 2017, well below analysts’ estimates, which pegged a 0.4 percent increase for the year.

During the fourth quarter ending Jan. 28, sales fell 4.3 percent year-over-year to $20.7 billion. Same-store sales dropped 1.5 percent. Net income was $817 million, or $1.45 per share, compared to $1.4 billion, or $2.32 per share. Analysts were expecting $1.51 per share.

Digital revenue during the quarter rose 34 percent.

“Our fourth-quarter results reflect the impact of rapidly changing consumer behavior, which drove very strong digital growth but unexpected softness in our stores,” said Brian Cornell, chairman and CEO of Target, in a statement.

Shares of Target fell about 13 percent in morning trading.

Context News

Target on Feb. 28 forecast a low-single-digit decline in comparable sales for 2017, well below analysts’ estimates, which pegged a 0.4 percent increase for the year.

Digital revenue during the quarter rose 34 percent.

Shares of Target fell about 13 percent in morning trading.

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