Target (TGT) - Get Target Corporation Reportshares slumped after the important Minneapolis store reported fiscal-first-quarter earnings that fell short of analyst estimates.
"Throughout the quarter, we were confronted with unexpectedly high costs, driven by a range of factors, which resulted in profitability that was well below our expectations and significantly below where we expect to operate over time," said Chairman and CEO Brian Cornell.
The report is followed by a day Walmart''s (WMT) - Get Walmart Inc. Reportposting of its low-than-expected fiscal-first quarter earnings and a reduction in its full-year profit forecast, as rising costs dip into the world''s largest retailer''s bottom line.
Target''s stock in mid-November had surpassed $269 in the 52-week high.
Target earns $2.16 a share for the quarter ended April 30, compared to 0.8 percent of the $4.17 a share earned in the year-earlier quarter. Revenue grew 4% to $25.17 billion, up from $24.2 billion.
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FactSet released a consensus projection for its first quarter earnings of $3.07 a share on revenues of $24.48 billion.
Comparable-store sales increased by 3.3 percent. The FactSet survey indicated a 0.9% increase.
The increase in sales reflected more often purchased categories, including food and beverage, beauty products, and household necessities.
The gross-profit margin was down from 30 percent in the year-earlier quarter, owing to higher marks.
Target said that "inventory limitations and actions to address lower-than-expected sales in discretionary areas" as well as expenses related to freight, supply-chain disruptions, and increased compensation and head count in our distribution centers.
Target expects revenue to increase by low- to mid-single levels for fiscal 2023.