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Retail giant Target Corporation on Tuesday reported worse than expected third-quarter earnings missing on major metrics. $TGT shares fell over 12% before the open, Competitor Walmart reported last week. E-commerce sales were higher with $WMT and $AMZN's ahead.

Target sales 

Target Corporation NYSE: TGT;Reported Earnings Before Market Open Tuesday

 $1.09 Missed $1.11 EPS and $17.59B Missed $17.812 billion forecast in revenue 

Earnings

Target Corporation NYSE: TGT reported earnings for the third quarter with earnings up 20% to $1.09 a share and revenue up 5.5% to $17.59 billion. However both numbers missed expectations of  EPS of $1.11 on revenue of $17.812 billion.

Consensus also expected a 5.2% same-store sales gain and Target reported 5.1%. On a GAAP basis, net income rose to $1.17 per share, compared to $0.87 per share during the same period last year.

Target Corporation NYSE: TGT

Market Reaction - Pre-market $68.13 −$9.66 (-12.42%)

Highlights

  • Target reported 5.1% growth in comp sales driven by healthy increases in both store and digital channels, but slightly below the Street consensus of 5.2%.
  • Thanks to the increasing investments in the digital platform, comparable online sales jumped 49% in Q3.
  • Revenue of the department store chain rose 5.6% to $17.8 billion. .

Target CEO Brian Cornell said, “We’ve made significant investments in our team heading into the holidays and they are ready to serve our guests with a comprehensive suite of convenient delivery and pickup options, a wide range of new products and unique gift ideas and a strong emphasis on low prices and great value.”

TGT Earnings Q3 18

Outlook

Despite the earnings miss, Target remains optimistic about the holiday quarter, when it anticipates comp sales growth of about 5%. The company also reiterated its guidance for full-year adjusted EPS between $5.30 and $5.50.

Walmart Earnings Recap

 $1.08 Beat $1.01 EPS and $125.5B Missed $126.1 billion forecast in revenue 

Earnings

Walmart Inc. (WMT) reported arnings for the third quarter with  total revenue up 1.4% year-over-year to $124.9 billion, slightly missing the consensus estimate of $125.5 billion. Excluding currency, revenues grew 2.4% to $126.1 billion.  Consolidated net income attributable to Walmart dropped 2.2% year-over-year to $1.71 billion. On a GAAP basis, EPS totaled $0.58 while on an adjusted basis, EPS was $1.08. Analysts had projected adjusted EPS of $1.01.

Walmart Inc NYSE: WMT

Market Reaction - Pre-market Pre-market 102.50 +0.97 (0.96%)

Highlights

  • Comparable sales grew 3.4% in Walmart US and 3.2% in Sam’s Club.
  • US ecommerce sales grew 43% during the quarter.
  • Grocery pickup is now available in around 2,100 locations and grocery delivery is available in around 600 locations, signalling progress in Walmart US omnichannel.
  • Walmart US saw comp sales increase across all its categories in the low to mid-single digits, driven by strength in food and consumables, pharmacy and apparel.
  • Walmart International posted comp sales growth in nine out of ten markets, including Mexico, China, Canada and the UK.
  • Comp sales growth at Sam’s Club was broad-based across major categories despite seeing a negative impact of 250 basis points from tobacco.

 Outlook

Walmart revised its guidance for the full year of 2019 and now expects comp sales, excluding fuel, at Walmart US to grow at least 3% versus the previous guidance of about 3%. GAAP EPS is now expected to come in the range of $2.26 to $2.36 versus the previous outlook 

Source: Target, AlphaStreet

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