Target Corporation

Target Corporation (TGT - Snapshot Report) recently announced first-quarter earnings of 69 cents per share, surpassing the consensus estimate by 15%. Sales of $14.4 billion came in above last year’s $14.3 billion.

Company Description

Target Corporation operates large-format general merchandise and food discount stores in the United States, which include Target and SuperTarget stores. They offer everyday essentials and fashionable, differentiated merchandise at exceptional prices.

They operate as a single business segment. Their credit card operations represent an integral component of their core retail business. They also operate a fully integrated online business, Target.com. Although Target.com is small relative to their overall size, its sales are growing at a much more rapid pace than their in-store sales, and it provides important benefits to their stores and credit card operations.

Solid results in the First Quarter

The company reported first-quarter results last week. Earnings of 69 cents per share surpassed the consensus estimate by 15%. Sales of $14.4 billion came in above last year’s $14.3 billion.

”Our first-quarter earnings per share reflect disciplined execution of our strategy in a difficult environment,” said Gregg Steinhafel, chairman, president and chief executive officer. “In our retail segment, we continue to experience strong positive comparable store sales results in our traffic-driving food and commodity categories, and the profitability of our first quarter sales was higher than expected due to outstanding gross margin and expense rate performance.” Steinhafel added that credit card segment results for the first quarter were stable, profitable and consistent with the company’s expectations.

Soaring Estimates

Analysts are bullish on earnings. 13 out of 18 covering analysts hiked full-year earnings forecasts from $2.72 per share to $2.83 in just the past week. The most accurate projection is even more bullish at $2.85.

Target’s earnings per share are expected to grow about 13% over the next 3 – 5 years, which above the industry average of 12%.

The company rewards shareholders with income, paying an industry-leading dividend yield of 2%.