Target Shares Tumble Premarket After 1Q Earnings Miss
May 18 2022 - 7:24AM
Dow Jones News
By Colin Kellaher
Shares of Target Corp. slid more than 20% in premarket trading
Wednesday after the retailer posted a fiscal first-quarter profit
that fell well short of Wall Street's expectations amid
unexpectedly high costs.
The Minneapolis company reported net income of $1.01 billion, or
$2.16 a share, for the quarter ended April 30, down from $2.1
billion, or $4.17 a share, a year earlier.
Excluding items, Target reported an adjusted profit of $2.19 a
share for the quarter. Analysts polled by FactSet, on average, had
been expecting adjusted earnings of $3.07 a share.
Target said higher markdown rates, driven largely by inventory
impairments and actions taken to address lower-than-expected sales
in discretionary categories, weighed on profit, as did costs
related to freight, supply-chain disruptions, and increased
compensation and headcount in its distribution centers.
Sales rose 4% to $24.83 billion, topping the $24.48 billion Wall
Street had been looking for. Comparable sales rose 3.3%, beating
expectations for a gain of 0.9%.
Target's earnings miss comes a day after retail titan Walmart
Inc. reported disappointing first-quarter results, as higher
product, supply-chain and employee costs ate into profits.
Target shares, which closed Tuesday at $215.28, were recently
down 21.6% to $168.80.
Write to Colin Kellaher at colin.kellaher@wsj.com
(END) Dow Jones Newswires
May 18, 2022 07:09 ET (11:09 GMT)
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