Target's 2nd-Qtr. Profit Rises as 3rd-Qtr. Forecast Hedges21 Aug, 2001 By: Hive News
Target Corp.'s second-quarter profit rose as the discount chain's low prices captured cost-conscious consumers, according to Bloomberg News.
Net income at Target, the third-largest U.S. discount chain, rose 5% to $271 million, or 30 cents a share. Target was among low-price retailers that won shoppers after job cuts and rising energy prices trimmed consumers' spending, said Bloomberg.
Target's c.f.o. Doug Scovanner said on a conference call that slow sales at the company's department stores and pressure on profit margins may keep earnings this year below analysts' average forecast of $1.53 a share.
Third-quarter profit probably will be at the low end of forecasts, Target said.
Target's shares fell $1.74, or 4.7%, to $35.36 on Tuesday. The stock had risen 41% in the past year.
Target's sales in the quarter ended Aug. 4 rose 8.5% to $8.95 billion, led by a 12% gain at its namesake discount stores.
Minneapolis-based Target has added about 75 discount stores since last year's second quarter, widening its reach at a time when shoppers are looking for low prices. Credit revenue jumped 14% to $146 million as more customers signed up for Target charge cards.
Target has 1,019 discount stores, 64 Marshall Field's and 265 Mervyn's stores.