Shares were pressured in early trading, however, after the retailer said operating margins would narrow from 2020 levels and hinted that overall performance would most likely compare to what it experienced prior to the pandemic.
Target said adjusted earnings for the three months ending in January were pegged at $2.67 per share, a 58% increase from the same period last year that topped the Street consensus forecast of $2.54 per share. Group revenues, Target said, rose 21.1% to $28.34 billion, again topping analysts' estimates of a $27.42 billion tally.
Target said same-store sales rose 6.9%, with overall comparable sales, including digital channels, rising 20.5%, well ahead of the Refinitiv forecast of 16.4%. Comparable digital sales, Target said, rose 118% from last year as online shopping continued to drive transactions amid the coronavirus pandemic.
"Following years of investment to build a durable, scalable and sustainable business model, we saw record growth in 2020, as our guests turned to Target to safely provide for their families throughout the pandemic," said CEO Brian Cornell. "With the strength of our unique, multi-category assortment and the flexibility we offer through our reliable and convenient fulfillment options, we gained nearly $9 billion in market share in 2020, and grew our revenue by $15 billion, which is more than the 11 prior years combined."
"As we look ahead to 2021 and beyond, we see continued opportunity to invest in our business and our team, building on the strong foundation we've established to drive market share gains and deliver profitable growth for years to come," he added.
Target shares were marked 3.8% lower in early trading following the earnings release to change hands at $179.10 each, a move that extends the stock's six-month gain to around 19.4%.
Last month, Target's larger rival, Walmart Inc. (WMT) - Get Report, posted record fourth-quarter sales of $152.1 billion but missed Street forecasts for its bottom line earnings as COVID costs increased and margins narrowed.