Target Q1 Earnings Top Expectations

Target Corporation

reported better-than-expected earnings for the first quarter on Wednesday. The company now projects full-year earnings of $4.50 to $4.65 per share, versus prior forecast of $4.45 to $4.65 per share. For the current quarter, the company expects earnings of $1.04 to $1.14 per share, versus analysts' estimates of $1.12 per share. The Minneapolis, Minnesota-based company posted a quarterly profit of $635 million, or $0.98 per share, versus a year-ago profit of $418 million, or $0.66 per share. Excluding one-time items, the company's earnings from continuing operations rose to $1.10 per share from $0.92 per share. Its net sales increased 2.8 percent to $17.1 billion from $16.7 billion. However, analysts were expecting earnings of $1.03 per share on revenue of $17.08 billion The average estimate among 22 Estimize users was for earnings of $1.04 per share and revenue of $17.2 billion. Digital channel sales increased 37.8 percent in the quarter. In the recent quarter, comparable store sales increased 2.3 percent. Number of transactions rose 0.9 percent, while average transaction value gained 1.4 percent. Its gross margin rate widened to 30.4 percent, from 29.5 percent. Target returned $895 million to shareholders in the first quarter. Brian Cornell, chairman and CEO of Target said, "We're encouraged to see early progress on our strategic priorities, including strong sales growth in Apparel, Home and Beauty, nearly 40 percent growth in digital sales, and positive traffic in both our stores and digital channels. We continue to benefit from strong execution by our stores team, who overcame weather challenges and West Coast port delays to deliver outstanding guest service in the first quarter." Target shares rose 1.41 percent to $79.02 in pre-market trading.