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Earnings Preview: Target sees Q3 adjusted EPS 83c-93c

Target (TGT) is expected to report Q3 earnings before the open on Thursday, November 15, with a conference call scheduled for 10:30 am ET. Analysts are looking for EPS of 79c on revenue of $16.93B. The consensus range is 74c-95c for EPS, and revenue of $16.65B-$17.09B, according to First Call. After reporting better than expected adjusted Q2 EPS of $1.12, forecast Q3 adjusted EPS 83c-93c and FY12 adjusted EPS $4.65-$4.85. The company said it was on track to deliver its long-term financial plan of $8 in EPS and $100B or more in sales by 2017. Target also forecast a 50c EPS impact of expenses related to its Canadian market entry. During the quarter, Target reported September same-store sales up 2.1% and October SSS up 2.4%. The company reached an agreement to sell its entire consumer credit card portfolio to TD Bank (TD) for an amount equal to the gross value of the outstanding receivables at the time of closing. Additionally, the two companies entered into a seven-year program agreement under which TD will underwrite, fund and own future Target Credit Card and Target Visa receivables in the United States. The company said two factors are expected to benefit its Q3 GAAP EPS: A gain from the agreement to sell its credit card receivables portfolio and a favorable resolution of income tax matters. Looking ahead, Target is expected to offer comments on the upcoming holiday season, and may offer comments on whether it believes Hurricane Sandy will impact holiday shopping and Q4 results.