Target (TGT) Stock Slips on Earnings Miss

Today is a big day for Target (NYSE:TGT) investors as the company just reported its second-quarter 2022 financial results. Even while Target highlighted its comparable sales growth, TGT stock traders couldn’t shake off the company’s profit miss.

Target is among the largest big-box retail store chains in America. So, today’s traders looked to Target to beat the Street and deliver powerful results. However, it appears the company fell short in certain crucial areas.

It emphasized that it increased its comparable sales by 2.6% year over year (YOY), on top of 8.9% growth last year. This might not be a great selling point, though, as it implies slowing growth in this regard.

Plus, here’s the main reason why today’s traders are in a sour mood. Target announced second-quarter 2022 GAAP earnings per share, or EPS, of 39 cents, down 89.2% from $3.65 in the year-earlier quarter. Meanwhile, analysts had modeled EPS of 72 cents per share.

What’s Happening with TGT Stock?

Target’s earnings miss was drastic, so it shouldn’t be too surprising that some investors divested their TGT stock shares today. Early in the day, the stock lost around 2% of its value.

That’s not a huge move in the share price, so it’s possible Wall Street is willing to forgive Target’s earnings miss. After all, it’s probably a good sign the company reaffirmed its full-year 2022 revenue growth guidance. It expects this figure to stay in the low- to mid-single digit range.

Moreover, Target anticipates its operating margin rate will land in a range of around 6% during the back half of 2022. It’s undoubtedly comforting for TGT investors to know the company isn’t overly pessimistic for the remainder of the year.

Will Target’s disappointing quarter set TGT stock up for third- and fourth-quarter earnings beats? It’s entirely possible if analysts and investors, given their disappointment today, maintain low expectations for Target.

On the date of publication, David Moadel did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

David Moadel has provided compelling content – and crossed the occasional line – on behalf of Motley Fool, Crush the Street, Market Realist, TalkMarkets, TipRanks, Benzinga, and (of course) InvestorPlace.com. He also serves as the chief analyst and market researcher for Portfolio Wealth Global and hosts the popular financial YouTube channel Looking at the Markets.

Leave a Reply

Your email address will not be published. Required fields are marked *