There was “meaningful pressure in electronics” during the second quarter, and a decline erased 70 basis points from overall sales at stores open for at least one year, he said.
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There had been some backlash to that move on social media, and an online petition was created encouraging shoppers to boycott Target.
In related news, Director Gilbert A. Garcia sold 7,936 shares of Sanchez Energy Corp. stock in a transaction that occurred on Friday, June 3rd. The company also paid $330 million in dividends to shareholders. He wants to regain the retailer’s cheap chic status and make Target more nimble after a series of headline-grabbing setbacks, including a pre-Christmas 2013 debit and credit card breach that damaged sales and profits for months. But striking the balance between offering stylish clothing and bedspreads while cultivating the perception that it’s also a place to buy toothpaste and detergent at a good price is tricky.
“Our progress in apparel and home has been really significant”, said Cornell. We believe Target possesses a well-known brand, convenient locations, and considerable scale; however, its product mix skews toward categories that go head to head with Amazon.
He added that he expects the company to restore traffic and sales growth “over time”. Cornell said during its conference call that sales of Apple products plunged more than 20% in the quarter.
Target spoke about this issue as it reported quarterly earnings results, which showed the store’s turnaround hit some turbulence this summer.
Target’s latest challenge in this regard, according to the newspaper, is with its supply chain for fresh meat, fruits and vegetables: Shoppers aren’t visiting often enough to keep perishable foods truly fresh so perishable foods, which are usually a big traffic driver at grocery stories, have become a drag on Target’s profitability.
Target struggled to sell electronics in the second quarter, especially Apple products.
Shares of the sixth-largest USA retailer dropped 6.2 per cent to US$70.82, erasing their gains for 2016. It now anticipates same-store sales will be flat to 2% lower for all of 2016, and lowered its earnings guidance from a range of $5.20 to $5.40 per share of TGT to a range of between $5.20 and $5.40. The retailer reported $1.23 earnings per share for the quarter, beating the Thomson Reuters’ consensus estimate of $1.12 by $0.11.
Compared to the same quarter a year ago, Target earnings declined 9.7% to $680 million. Revenue came in line with analysts’ expectations at $16.17 billion.
United States of America based company Target Corp.’s (TGT)’s latest closing price was 2.97% from the average-price of 200 days while it maintained a distance from the 50 Day Moving Average at 6.08% and 1.80% compared with the 20 Day Moving Average. For both the third and fourth quarters of 2016, Target now expects a year-over-year same-store sales change of between -2 percent to 0 percent.
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Elements of this story was generated by Automated Insights (http://automatedinsights.com/ap) using data from Zacks Investment Research.
