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Target (TGT) Q2 Earnings: Can the Stock Pull a Surprise?
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Target Corp. (TGT - Free Report) is slated to release second-quarter fiscal 2016 results on Aug 17. The question is whether this operator of general merchandise stores will be able to deliver a positive earnings surprise in the quarter to be reported. Notably, in the trailing four quarters, the company has outperformed the Zacks Consensus Estimate by an average 4%. Let’s see how things are shaping up for this announcement.
Zacks Model Shows Unlikely Earnings Beat
Our proven model does not conclusively show that Target is likely to beat earnings estimates this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. Target carries a Zacks Rank #3, which increases the predictive power of ESP. However, the company has an Earnings ESP of 0.00% as both the Most Accurate estimate and the Zacks Consensus Estimate stand at $1.13. The combination of Target’s Zacks Rank #3 and a 0.00% ESP makes surprise prediction difficult for this quarter.
Factors Influencing this Quarter
Target has undertaken a series of initiatives, such as the development of omni-channel capacities, diversification and localization of assortments, along with emphasis on smaller format stores, all of which may help augment its performance in the quarter to be reported. The company plans to expand its merchandise assortments, with special focus on the well-performing categories like Style, Baby, Kids and Wellness. Management is also keen on expanding the Food category. Target has adopted an aggressive cost reduction strategy as well. However, the competitive retail landscape and lower discretionary spending may weigh upon its performance.
Management had earlier projected adjusted earnings in the band of $1.00 to $1.20 per share for the second quarter. Comparable sales are anticipated to be flat to down 2% during the quarter.
Here are some companies you may want to consider as our model shows that these have the right combination of elements to post an earnings beat:
GameStop Corp. (GME - Free Report) has an Earnings ESP of +7.14% and a Zacks Rank #2.
Lowe's Companies, Inc. (LOW - Free Report) has an Earnings ESP of +2.13% and a Zacks Rank #2.
Best Buy Co., Inc. (BBY - Free Report) has an Earnings ESP of +7.14% and a Zacks Rank #2.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>
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Target (TGT) Q2 Earnings: Can the Stock Pull a Surprise?
Target Corp. (TGT - Free Report) is slated to release second-quarter fiscal 2016 results on Aug 17. The question is whether this operator of general merchandise stores will be able to deliver a positive earnings surprise in the quarter to be reported. Notably, in the trailing four quarters, the company has outperformed the Zacks Consensus Estimate by an average 4%. Let’s see how things are shaping up for this announcement.
Zacks Model Shows Unlikely Earnings Beat
Our proven model does not conclusively show that Target is likely to beat earnings estimates this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. Target carries a Zacks Rank #3, which increases the predictive power of ESP. However, the company has an Earnings ESP of 0.00% as both the Most Accurate estimate and the Zacks Consensus Estimate stand at $1.13. The combination of Target’s Zacks Rank #3 and a 0.00% ESP makes surprise prediction difficult for this quarter.
Factors Influencing this Quarter
Target has undertaken a series of initiatives, such as the development of omni-channel capacities, diversification and localization of assortments, along with emphasis on smaller format stores, all of which may help augment its performance in the quarter to be reported. The company plans to expand its merchandise assortments, with special focus on the well-performing categories like Style, Baby, Kids and Wellness. Management is also keen on expanding the Food category. Target has adopted an aggressive cost reduction strategy as well. However, the competitive retail landscape and lower discretionary spending may weigh upon its performance.
Management had earlier projected adjusted earnings in the band of $1.00 to $1.20 per share for the second quarter. Comparable sales are anticipated to be flat to down 2% during the quarter.
TARGET CORP Price, Consensus and EPS Surprise
TARGET CORP Price, Consensus and EPS Surprise | TARGET CORP Quote
Stocks Poised to Beat Earnings Estimates
Here are some companies you may want to consider as our model shows that these have the right combination of elements to post an earnings beat:
GameStop Corp. (GME - Free Report) has an Earnings ESP of +7.14% and a Zacks Rank #2.
Lowe's Companies, Inc. (LOW - Free Report) has an Earnings ESP of +2.13% and a Zacks Rank #2.
Best Buy Co., Inc. (BBY - Free Report) has an Earnings ESP of +7.14% and a Zacks Rank #2.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>