Retail Pros Dissect Target's 'Scary' Numbers
Target also issued a downbeat forecast for its second quarter, which Paul Trussell of Deutsche Bank called "scary." The retail analyst was a guest on CNBC.
According to Trussell, the entire retail sector has "disappointed" investors at a time when investors are debating if the poor results are a reflection of consumer spending their dollars elsewhere, such as online or at off-price retailers.
However, Trussell said Target's guidance is "scary," especially for a "bread and butter retailer" that's considered an "every day" retailer that consumers typically visit for various products.
He continued that Target's deceleration guidance "puts us in question about the pace of consumer spending on a go-forward basis... well beyond apparel."
He added that apparel appears to be "the first category" that consumers have "shied away from."
Stacey Widlitz, President of SW Retail Advisors, was also a guest during the segment and suggested Target is guilty of under-investing in its e-commerce platform as only 4 percent of total sales are derived from its online store.
She further suggested that it's "scary" how Target will be entering a phase of heavy spending to bolster its online business.
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