This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Target Quarter Swollen by Gain

Updated from 9:12 a.m. EDT

Shares of Target (TGT - Get Report) were outperforming the broader market after the company posted a huge increase in quarterly profit thanks to the sale of its Marshall Field's department store chain. The company was also upbeat on a conference call, listing off several new initiatives to drive growth.

The company also said the Thomson First Call third-quarter earnings-per-share estimate is a "reasonable expectation." Shares of the company were lately up $2.19, or 5.4%, at $42.61.

Earlier, the company said net income in the period ended Aug. 2 was $1.416 billion, or $1.54 a share, compared to $358 million, or 39 cents a share, in the year-earlier period. Results included a gain of $1.11 a share from the sale of Marshall Field's to May Department Stores (MAY), which was finalized on July 31.

The latest quarter also showed earnings from continuing operations of 40 cents a share -- which included a loss of 5 cents a share from the repurchase of $455 million in debt -- and earnings from discontinued operations of $31 million, or 3 cents a share. Discontinued operations are now Mervyn's and Marshall Field's.

Total sales were up 10% at $10.56 billion, up from the prior year's $9.6 billion. Same-store sales increased 3.9%.

Analysts' consensus was for a profit of 47 cents a share on sales of about $12 billion.

Target said earnings before interest and taxes were $795 million, up 16.4% from the prior year's $685 million. The company's credit card division added $120 million to earnings before taxes.

Gross margin in the latest quarter jumped 99 basis points, the company said, citing improvement in both merchandise mark-up and markdown rates. Selling, general and administrative expenses, however, increased 63 basis points. Target cited in part higher worker's compensation costs.

Target reiterated that its July 29 announcement to sell 257 Mervyn's stores to a group of investors and Mervyn's credit card receivables to General Electric's (GE) Consumer Finance division is still expected to close in the third quarter. Consequently, it expects to have a pretax gain of $270 million, or 18 cents a share.
1 of 3

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
TGT $79.71 0.00%
WMT $67.19 0.00%
AAPL $94.19 0.00%
FB $118.06 0.00%
GOOG $695.70 0.00%


Chart of I:DJI
DOW 17,651.26 -99.65 -0.56%
S&P 500 2,051.12 -12.25 -0.59%
NASDAQ 4,725.6390 -37.5850 -0.79%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs