NEW YORK (TheStreet) -- Shares of Target (TGT) were surging by 9.01% to $77.88 in early morning trading on Wednesday, after the discount store reported higher-than-expected earnings and revenue for the 2016 third quarter before today's opening bell.
Target reported earnings of $1.04 per share for the quarter, topping estimates for 83 cents per share. Revenue came in at $16.44 billion, beating expectations for $16.3 billion. For the same quarter in 2015, Target earned 86 cents per share on revenue of $17.61 billion.
While the quarterly results were better than expected, they weren't up year-over-year, noted Telsey Advisory Group retail analyst Joe Feldman on BloombergTV's "Bloomberg Daybreak: Americas" on Wednesday morning. The firm has an "outperform" rating and $82 price target on the stock.
"I mean it's somewhat a sigh of relief that things were actually better than what was feared," he said. "But directionally, trends definitely improved. Traffic was down by 1% which is not great, but last quarter it was down 2%."
Target's signature categories, including baby, kids, home, apparel, as well as wellness products have been its focus for about the past 18 months, and these performed better than the company as a whole, Feldman pointed out. "So where they've been focusing, they've seen good trends and I think that that is a good thing that we continue to see that. So we're happy with that."
Target also revised its expectations for its 2016 fourth quarter comparable sales to between -1% and 1% vs. previous expectations of -2% to flat.