Target (TGT) reported quarterly earnings and revenue that beat Wall Street's expectations on Wednesday.
TGT).After the earnings announcement, the company's shares initially rose in pre-market trading, but subsequently retreated on investor worries about the company's ability to reach its forecast, given its expansion plans in Canada. Click here to track the company's shares following the report: (
Target is about to open its first store in Canada, and plans to expand to 124 locations.
The company posted fourth-quarter earnings excluding items of $1.65 per share, up from $1.43 a share in the year-earlier period.
Revenue increased to $22.73 billion from $21.29 billion a year ago.
"November and December were both very tough months for Target, but they had a nice pick-up in January — a 3.1 percent increase, and earnings were pretty much right in line as well," said Patrick McKeever, a senior equity analyst at MKM Partners.
Wall Street had expected the discount chain to deliver earnings excluding items of $1.48 a share on $22.69 billion in revenue, according to a consensus estimate from Thomson Reuters.
"We're pleased with Target's fourth quarter performance, particularly in the face of a highly promotional retail environment and continued consumer uncertainty," Gregg Steinhafel, chairman, president, and chief executive officer, said in a statement.
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For fiscal 2013, the Company expects adjusted earnings per share of $4.85 to $5.05, a range that was above the $4.83 that analysts had been expecting, according to a consensus estimate from Thomson Reuters.
"Frankly, it's a little bit light of where I was thinking it would be," said McKeever about Target's outlook. "They don't make any comments on sales so all ears will be on what they say about February (during the earnings call)."
During the current quarter, Target forecast adjusted earnings per share of $1.10 to $1.20, which was higher than the $1.05 that Wall Street had forecast, according to Thomson Reuters.
After Wal-Mart Stores (WMT) said its February sales got off to a slower start than usual due in large part to delayed income tax refunds, investors will be looking to Target's report to gauge the health of the U.S. consumer, who has been stung by higher gas prices and the payroll tax hike.
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