Target reports EPS in-line, revs in-line with comps at high end of guidance; guides Q4 EPS in-line (raises low end of FY16 EPS guidance) :
- Reports Q3 (Oct) earnings of $0.86 per share, excluding non-recurring items, in-line with the Capital IQ Consensus of $0.86; revenues rose 2.1% year/year to $17.61 bln vs the $17.57 bln Capital IQ Consensus.
- Q3 comps +1.9% vs. +1-2% guidance, driven by traffic growth of 1.4 percent. On a two-year stacked basis, sales and traffic growth were stronger in the third quarter than either of the first two quarters of the year.
- Comparable sales in signature categories (Style, Baby, Kids and Wellness) grew more than 2.5 times faster than the company average.
- Digital channel sales increased 20 percent, contributing 0.4 percentage points to comparable sales growth.
- Third quarter gross margin rate was 29.4% vs. 29.5%, as benefits from a favorable merchandise mix and the comparison over last year's intense promotional markdowns were offset by reimbursement pressure in Healthcare and the impact of investments in quality and innovation on the company's owned and exclusive brands.
- Q3 comps +1.9% vs. +1-2% guidance, driven by traffic growth of 1.4 percent. On a two-year stacked basis, sales and traffic growth were stronger in the third quarter than either of the first two quarters of the year.
- Co issues in-line guidance for Q4, sees EPS of $1.48-1.58, excluding non-recurring items, vs. $1.54 Capital IQ Consensus Estimate.
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