) posted soft sales results for the five-week period ended
September 29, 2012. Target, the operator of general merchandise and
food discount stores in the United States, registered an increase
of 2.1% in comparable store sales for September 2012, driven by a
rise in average transaction size along with a marginal increase in
comparable store transactions.
However, sales were well below an increase of 5.3% marked in
September 2011. In terms of performance, Target also lagged its
Costco Wholesale Corporation
), which witnessed an augmentation of 6% in comparable store sales
during the period under review.
The rise in comparable-store sales was in-line with management's
expectation, reflecting robust sales in Food category.
Category wise, Target reported solid sales in Food, with health and
beauty increasing in mid-single-digit. The company stated that
sales in home category marked a marginal rise, while apparel and
hardlines witnessed a downfall. Alongside, the company registered
escalated sales in every region.
Minneapolis, Minnesota-based Target Corporation announced that net
retail sales for September elevated 2.6% to $6.08 billion from
$5.92 billion reported in the year-ago period.
Year-to-date, Target registered a 3.9% increase in comparable store
sales with a 4.5% rise in net retail sales to $44.61 billion.
Going forward, the company expects fiscal third quarter 2012
adjusted earnings in the range of 83 cents to 93 cents a
share. The current Zacks Consensus Estimate for the third
quarter of 2012 is 77 cents, representing a year-over-year decline
of 6.4%. Moreover, the company expects comparable store sales to
increase in the low to mid single-digit in October 2012.
In addition, the company announced that it will not report its
monthly sales results from the start of fiscal 2013.
Currently, we prefer to have a long-term 'Neutral' recommendation
on the stock. However, Target holds a Zacks #2 Rank, which
translates into a short-term 'Buy' rating.
COSTCO WHOLE CP (COST): Free Stock Analysis
TARGET CORP (TGT): Free Stock Analysis Report
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