What to Look For in Target’s Q1 Report

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Target Corp. (NYSE: TGT) is scheduled to release its fiscal first-quarter financial results before the markets open on Wednesday. The consensus estimates from Thomson Reuters call for $1.38 in earnings per share (EPS) on $16.5 billion in revenue. In the same period of last year, the retailer said it had EPS of $1.21 and $16.02 billion in revenue.

In its fiscal fourth quarter, Target reported that comparable sales increased 3.6%, while comparable digital channel sales grew 29%. In this time, traffic grew 3.2%, reflecting healthy increases in both stores and digital channels.

These numbers are proving that Target can fight back against the likes of Amazon and Walmart, but this isn’t easy.

To keep up with its competition, Target recently announced that it would be making a change to its delivery service. The firm is going to reward some of its more loyal customers while incentivizing others to step up.

Starting last week, customers purchasing household staples through Target’s Restock service will pay a $2.99 delivery fee instead of $4.99. And those who buy items with Target’s branded credit/debit card won’t pay anything extra at all.

Additionally, Target has said that it is tapping its network of stores to more quickly fulfill orders and shrink the time it might take for products to be delivered from a distant warehouse.

Excluding Tuesday’s move, Target has outperformed the broad markets, with its shares up 37% in the past 52 weeks. In just 2018 alone, Target is up close to 18%.

A few analysts weighed in on Target ahead of the earnings report:

  • Wolfe Research has an Outperform rating.
  • MKM Partners has a Buy rating with a $93 price target.
  • Credit Suisse has a Buy rating and an $86 price target.
  • Morgan Stanley has a Sell rating with a $64 price target.
  • Telsey Advisory Group has a Market Perform rating.
  • Susquehanna has a Buy rating with a $95 target price.

Shares of Target were last seen down about 1% at $75.83, with a consensus analyst price target of $76.12 and a 52-week range of $48.56 to $78.70.