- Target will report third-quarter results before the bell on Wednesday.
- The company, which sells a broader mix of clothing, home goods and impulse purchases than some rivals, has been particularly pressured by inflation.
- Investors will be watching for signs that the retailer’s sales are recovering or gaining momentum as Target prepares for the crucial holiday season.
A Target department store in North Miami Beach, Florida, on May 17, 2023.
Joe Raedle | Getty Images
Target will report third-quarter results on Wednesday as the company looks to recover from a series of disappointing results and major setbacks.
Investors will be watching for signs that the retailer’s sales are recovering as Target prepares for the crucial holiday season.
Here’s what Wall Street expects for the company for the three-month period, based on an analyst survey from LSEG, formerly known as Refinitiv:
- Earnings per share: $1.48 expected
- Revenue: $25.24 billion expected
Across retail, sales have fallen as consumers suffer from high prices and choose to spend on experiences instead. But Target, which sells a broader mix of clothing, home goods and impulse purchases than some rivals, has come under particular pressure.
Furthermore, it faced its own challenges. Target received criticism for a merchandise collection for Pride Month, a celebration of LGBTQ+ people and issues that the company has sold for more than a decade. It has been plagued by higher levels of organized retail crime. And recently, nine stores in major cities were closed, with thefts and threats of violence blamed for the closures.
The Minneapolis-based company cut its full-year forecast in August, saying it expects comparable sales to decline by about a mid-single-digit percentage and earnings per share of $7 to $8.
Target’s stock has suffered as sales have stagnated. The company’s shares have fallen almost 26% this year, with their value having fallen by more than half since the height of the Covid pandemic.
In a CNBC interview with Becky Quick that aired earlier this month, Target CEO Brian Cornell said the company’s consumer goods sales have declined for seven straight quarters, both in dollars and units. He said shoppers are buying fewer clothes and toys and even less food.
However, he was positive about the important Christmas season. He said the company has seen sales increase around “seasonal moments” like Halloween, Mother’s Day and summer holidays – a dynamic that could help as Black Friday, Thanksgiving and Christmas approach.
Home Depot’s quarterly report on Tuesday also gave cause for optimism. The home improvement retailer forecast a decline in sales compared to last year, but said the worst of inflation had passed.