We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Target (TGT) Stock Soars After Q2 Earnings Beat: Extends YTD Lead Over Walmart
Read MoreHide Full Article
Target (TGT - Free Report) reported its second quarter earnings before the opening bell, beating estimates and sending its stock soaring over 19% to set a new all-time high for the retailer. Target’s quarterly report comes almost a week after rival super store, Walmart (WMT - Free Report) , posted its Q2 report with similarly strong results. However, Target is currently up 54.6% YTD, surpassing Walmart’s 2019 growth of 20.5%. Let’s see how the two quarterly reports compare and how investors should play the recent retail boost.
Second Quarter Performances
Last week, Walmart reported Q2 earnings of $1.27 per share, beating estimates by 4.1%. The company generated $130.4 billion in revenue, slightly missing estimates by 0.1%. The company’s reported earnings were a fall of 1.6% year over year but revenue was a jump of 1.8%. Walmart’s Y/Y revenue growth was primarily driven by strong performance from the U.S. Walmart segment, leaping 2.9% to $85.2 billion. U.S. comps, excluding fuel, improved 2.8% backed by a 0.6% rise in transactions and 2.2% in ticket. E-commerce sales for the company soared 37% in Q2, and its next day delivery service now covers 75% of the U.S. population. Both Walmart and Target have been trying to improve their shopping experiences for consumers.
Target reported Q2 earnings of $1.82 per share, surpassing our estimate by 13.04%; revenues came in at $18.42 billion, beating estimates by 0.49%. The company’s Q2 earnings spiked 22% while revenue climbed 3.6% year over year; Target’s same store sales were up 3.4%. The super store giant’s quarterly profits surged 17.4% to $938 million with the help of its in-store pickup and same-day shipping services. The company reported that same-day fulfillment services (Order Pick Up, Drive Up and Shipt) accounted for nearly 1.5 percentage points of its overall comparable sales growth. TGT’s comparable sales has grown roughly 10% over the past two years, marking its best performance in over a decade. As a result, Target raised its fiscal 2019 EPS guidance to $5.90-$6.20 per share from the previous range of $5.75-$6.05.
Bottom Line
Both Walmart and Target had a solid first six months in 2019, and capped it off with strong Q2 reports. They both have undertaken contemporary measures to improve their customer service through initiatives to enhance their e-commerce footprint and match competitive delivery times from the likes of Amazon (AMZN - Free Report) . While both have benefited from these initiatives, Target took an extra step and invested in remodeling its stores and opened small format locations in major cities like New York; the company now has over 80 small format stores in urban areas.
TGT sports a Zacks Rank #2 (Buy) and WMT is sitting at a Zacks Rank #3 (Hold). Investors should also consider valuation. Target has historically, and is currently trading, at a discount relative to its industry while Walmart has traded at a premium for the better part of 2 years. Value investors looking for a solid entry point in a stock that has been on the come up in 2019 should take a serious look at TGT as the retailer seems poised to continue its rally into the second half of 2019.
Biggest Tech Breakthrough in a Generation
Be among the early investors in the new type of device that experts say could impact society as much as the discovery of electricity. Current technology will soon be outdated and replaced by these new devices. In the process, it’s expected to create 22 million jobs and generate $12.3 trillion in activity.
A select few stocks could skyrocket the most as rollout accelerates for this new tech. Early investors could see gains similar to buying Microsoft in the 1990s. Zacks’ just-released special report reveals 7 stocks to watch. The report is only available for a limited time.
Image: Bigstock
Target (TGT) Stock Soars After Q2 Earnings Beat: Extends YTD Lead Over Walmart
Target (TGT - Free Report) reported its second quarter earnings before the opening bell, beating estimates and sending its stock soaring over 19% to set a new all-time high for the retailer. Target’s quarterly report comes almost a week after rival super store, Walmart (WMT - Free Report) , posted its Q2 report with similarly strong results. However, Target is currently up 54.6% YTD, surpassing Walmart’s 2019 growth of 20.5%. Let’s see how the two quarterly reports compare and how investors should play the recent retail boost.
Second Quarter Performances
Last week, Walmart reported Q2 earnings of $1.27 per share, beating estimates by 4.1%. The company generated $130.4 billion in revenue, slightly missing estimates by 0.1%. The company’s reported earnings were a fall of 1.6% year over year but revenue was a jump of 1.8%. Walmart’s Y/Y revenue growth was primarily driven by strong performance from the U.S. Walmart segment, leaping 2.9% to $85.2 billion. U.S. comps, excluding fuel, improved 2.8% backed by a 0.6% rise in transactions and 2.2% in ticket. E-commerce sales for the company soared 37% in Q2, and its next day delivery service now covers 75% of the U.S. population. Both Walmart and Target have been trying to improve their shopping experiences for consumers.
Target reported Q2 earnings of $1.82 per share, surpassing our estimate by 13.04%; revenues came in at $18.42 billion, beating estimates by 0.49%. The company’s Q2 earnings spiked 22% while revenue climbed 3.6% year over year; Target’s same store sales were up 3.4%. The super store giant’s quarterly profits surged 17.4% to $938 million with the help of its in-store pickup and same-day shipping services. The company reported that same-day fulfillment services (Order Pick Up, Drive Up and Shipt) accounted for nearly 1.5 percentage points of its overall comparable sales growth. TGT’s comparable sales has grown roughly 10% over the past two years, marking its best performance in over a decade. As a result, Target raised its fiscal 2019 EPS guidance to $5.90-$6.20 per share from the previous range of $5.75-$6.05.
Bottom Line
Both Walmart and Target had a solid first six months in 2019, and capped it off with strong Q2 reports. They both have undertaken contemporary measures to improve their customer service through initiatives to enhance their e-commerce footprint and match competitive delivery times from the likes of Amazon (AMZN - Free Report) . While both have benefited from these initiatives, Target took an extra step and invested in remodeling its stores and opened small format locations in major cities like New York; the company now has over 80 small format stores in urban areas.
TGT sports a Zacks Rank #2 (Buy) and WMT is sitting at a Zacks Rank #3 (Hold). Investors should also consider valuation. Target has historically, and is currently trading, at a discount relative to its industry while Walmart has traded at a premium for the better part of 2 years. Value investors looking for a solid entry point in a stock that has been on the come up in 2019 should take a serious look at TGT as the retailer seems poised to continue its rally into the second half of 2019.
Biggest Tech Breakthrough in a Generation
Be among the early investors in the new type of device that experts say could impact society as much as the discovery of electricity. Current technology will soon be outdated and replaced by these new devices. In the process, it’s expected to create 22 million jobs and generate $12.3 trillion in activity.
A select few stocks could skyrocket the most as rollout accelerates for this new tech. Early investors could see gains similar to buying Microsoft in the 1990s. Zacks’ just-released special report reveals 7 stocks to watch. The report is only available for a limited time.
See 7 breakthrough stocks now>>