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Target and Lowe’s Woes Tied to Weather, Saks Skyrockets on Tabloid Story

Dan Berman
Hot Stock Minute
Target and Lowe’s Woes Tied to Weather, Saks Skyrockets on Tabloid Story

Target (TGT) released its quarterly earnings within the past hour. The company missed narrowly on revenues, but excluding items it easily beat on earnings posting $1.05 a share when estimates were for 85-cents. Target is blaming soft sales in season and weather related categories for the miss. By the way, Target has just started a push into Canada, where it has just opened 24-stores. Shares are down 2% in early trading but they're up about 25% over the past year.

Lowe's (LOW) is also down about 2% this morning on the release of its quarterly report. The company missed estimates posting profits of 49-cents a share when consensus was for 51-cents. The home improvement chain also came-in about $300-million shy on revenues. Just for reference, Home Depot had a strong beat yesterday citing the improving housing market. Lowe's like Target is blaming the weather for its woes, saying cool temperatures and lots of rain this spring hurt sales of outdoor items. Lowe's is up 67% over the past year as the housing recovery seems to take hold.

Hewlett-Packard (HPQ) will be reporting earnings after today's closing bell. Analysts are calling for the company to post profits of 81-cents a share down from 98-cents a year ago. Revenue is also expected to be significantly lower. The issues here are no secret: HP's core printer and PC businesses are slowing. At the same time it's facing tough competition in newer ventures like the cloud. Nevertheless the company has been the best performer in the Dow this year, up more than 40%.

Shares of Saks (SKS) are up a whopping 19% right now. That's on top of an 11% jump yesterday. The second part of the climb came after the New York Post reported that Saks has hired Goldman Sachs (GS) to explore the possibility of selling itself. The first one resulted from the company's release of its quarterly report. Excluding items, Saks matched expectations for earnings of 19-cents a share with a beat on revenues. The chain says sales for the rest of the year should be up between 4% and 6%. Even before this morning's rise, yesterday's climb brought the stock to a 5-year high.